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Stocks can get wiped out. It has happened before, and it will happen again. I remember when I was a youngin ... Nortel seemed like a sure thing.

• AnthonyMouse 5y ago
  That's why diversification is a thing. The people who invested 2% of their money in Nortel and the rest in 49 other random major companies are doing a lot better than the people who held it all in cash.
  • srean 5y ago
    Diversification is not going to help when the entire market crashes and that seems to happen frequently enough.
    • javagram 5y ago
      Holding a diversified U.S. stock portfolio would have “helped” in every major market crash since 1929. (Perhaps at some point US stocks will end their 100 year run of success though.) This is easily demonstrated by visiting https://www.portfoliovisualizer.com/ https://www.portfoliovisualizer.com/ and observing that an investment in US stocks has always grown in value over sufficient time.
      • srean 5y ago
        Aren't market crashes defined as events where the entire market crashes. In such cases even the index funds would have lost value. Didn't the crash of 2008 affect almost all stocks (and perhaps even bonds) ? Not everyone has the forward runway of 20~25 years. There are periods of 20 years that gave little to no return in the stock market [in other words a loss]. "Sufficient time" might be long enough that I am on my death bed by that time. The opportunity cost of waiting in the hopes that the prices will some day pickup can be substantial.