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sorry but the only answer any investor should care about is achieving their financial goals over the expected investment timeframe. markets tend to rise and as
by junkscience2017 9y ago
sorry but the only answer any investor should care about is achieving their financial goals over the expected investment timeframe.
markets tend to rise and as a result market declines tend to be temporary
the permabear thesis appeared in the early 80s when the US was in a rut and we also became a debtor nation. the permabear thesis -that debt and fiat currency would produce an economy favoring the pessimistic (but not completely imploding to the point of collapse, because you can't invest in that), proved to be wrong over a thirty year window
if you have an axe to grind, you will always find a permabear manager willing to tell you tales of doom...it will cost you your financial goals though
- exelius 9y agoI think these funds are useful as a risk hedge — there is some non-zero risk every year that the economy will collapse. If you invest in a fund that will help offset some of that risk by performing above average in a downturn, you might want to do it as part of a portfolio strategy. Nobody should be putting their life savings into one of these. Hedge funds like this aren’t for that; they’re a risk management lever that gets set according to the economic model an investor is using.
- junkscience2017 9y agolots of people here keep using the term "hedge"...none of the permabears market these as hedge funds...they do not internally hedge their own risk positions these are what they appear to be - bear market funds
- oarsinsync 9y agoGiving a bear market fund a % of your total investment capital is the hedge. They don't need to be hedging their positions, you've already done that on the macro level by diversifying your investment portfolio.