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That's why most people should just stick to index funds.
by x3sphere 6y ago
That's why most people should just stick to index funds.
- erikbye 6y agoIf they get out before crashes. Otherwise you could end up at zero again after being in for a decade. Maybe that was timed just with your retirement when you were about to make use of your now vanished gains.
- joncrane 6y agoThe value of a big index fund going to zero is so inconceivable as to be hardly worth considering. That would mean that ALL 500 of the US' largest companies by market cap all go completely bankrupt WITHIN ONE CALENDAR YEAR. I think if atomic bombs were to destroy the 50 largest cities in the USA, that this wouldn't happen. There would still be enough economic activity in enough of the 500 companies to justify some price above zero. So the scenario would literally be the apocalypse. The kind of apocalypse where the US dollar has zero value. The kind of apocalypse where the amount of money in a brokerage account would not even be on the top 100 list of things a human would be worried about. Even losing 90% of value would be an event so unprecedented in magnitude that it would make anthropomorphic climate change seem like a footnote in history.
- erikbye 6y agoSorry, to clarify: I meant end up at zero gain, not zero as in loss. So instead of losing money, it would just be not having gained anything in 10 years, which is not that unlikely, and has happened. Ask me, that is 10 years of potential profit loss, had you invested differently.