Re:Why in the world would you own bonds?
by glenmorangie_14 on Wednesday March 17, 2021 @01:18PM
(#26494178)
The SP500 was around $950 in Sept of 1997. It was also around $950 in July of 2009. I would say the stock market went no where for 20 years.
I don't think it is fair to call 2001 and 2008 "blips". Their combined effect was we lost 20 years worth of potential growth.
Re:Why in the world would you own bonds?
by loco5niner on Wednesday March 17, 2021 @06:32PM
(#26497616)
It certainly didn't go nowhere. Obviously, if someone bought and sold their entire portfolio on those (VERY cherry-picked - just look at the graph, lol) days, they would have made 0 dollars.
But look on either side of that blip and there is plenty of profit.
What this is missing is the amount of time investors are investing in. Day traders don’t care about tomorrow, they care about the difference between 9 am and 4 pm. Options traders might care about the next few weeks. If you are investing for 20+ years in a retirement account, you don’t care about the bubble. It will self correct over a year and by the time you withdraw, stocks are significantly up.
Bonds make sense if you are investing for 1 month to say 3 years.