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Index funds are not risk free! We have had a solid 15 years and everyone forgot that there are decades of declines or stagnation.
by groundzeros2015 2mo ago
Index funds are not risk free! We have had a solid 15 years and everyone forgot that there are decades of declines or stagnation.
- AussieWog93 2mo agoLFSPA is a cap note, not an index fund. Hence the lower returns, haha. Not saying it's necessarily the ideal vehicle but anything beats the banks.
- groundzeros2015 2mo agoAustralian and New Zealand private small business and consumer lending? while you’re at it maybe pick up some Indian bonds which have a high coupon close to 8%?
- nunez 2mo agoThat's why you hedge with Bogleheads three headed fund. Bonds are strong when the indexes are weak according to them
- jandrewrogers 2mo agoThe anti-correlation between bonds and equities hasn’t been a thing for decades. That is advice that passed its sell-by date a while ago. The modern version is to go hard into equities and out-grow the drawdown risks. You still want a couple years of burn in treasuries but that is strictly a buffer against adverse returns. By the time you retire, the treasury fraction is a tiny fraction of the total by virtue of the equity growth rate.
- groundzeros2015 2mo agoI don’t have any reason to think that international economies are not correlated to the US. But also I don’t expect them to be that successful. Europe and South-east Asia have a mafia like relationship with their established businesses and regulate away new ones. The sibling comment addresses bond funds. ZIRP, 2008, Covid, trump, big tech, and AI all came after Boyle.
- blitzar 2mo agoI would happily have a decade of declines or stagnation on the 10's of 1,000s in the kids account over the next 20 years - they can then invest in their productive earning years in companies trading at p/e's of 10 again.