4 ms·
>The game is "rigged", so play along. Yup, just keep buying long term debt. Fun fact, long term us treasuries have crushed stocks over the last 25 years. 1.5x
by tryptophan 6y ago
>The game is "rigged", so play along.
Yup, just keep buying long term debt.
Fun fact, long term us treasuries have crushed stocks over the last 25 years. 1.5x leveraged LTTs gained 1% more yearly that stocks since 1992, with the same volatility, but a maximum drop-down of 25% as compared to 50% for stocks. Thanks FED!
- drocer88 6y agoAccording to Professor Damodaran's data here : http://pages.stern.nyu.edu/~adamodar/ http://pages.stern.nyu.edu/~adamodar/ (See Historical Returns on Stocks, Bonds and Bills - United States ), Average returns from stocks from 1994 to 2019 was 11.36% and returns for T-Bonds were 5.51%, pretty close to their 1928-2019 average returns of 11.57% and 5.15% . These results are not inflation adjusted.
- tryptophan 6y ago#1: LTTs are almost separate asset class from generic "T-bonds". They have a long duration, 20+ years to maturity. I get this data from the VUSTX fund, which tracks a long bond index. #2: We used leverage to match volatility. This can realistically be done using futures. (and yes, I am claiming a leveraged bond portfolio is less risky than a 100% stock portfolio; the numbers back it!)
- drocer88 6y agoPerhaps you need to compare with 3X bull equity portfolios for a better comparison.
- tick_tock_tick 6y ago60% TQQQ / 40% TMF is the best portfolio.
- tryptophan 6y ago3x bull equity portfolios are not a good comparison, because their volatility is much much much higher. They are strictly worse portfolios, which take on great risk. My point about bonds is that they take __less__ risk and still make more money.