51–60 of 136 posts
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The recent drop is not very significant (a little over 10%). The Great Financial Crisis caused a 60% drop around 2008/2009. https://www.nytimes.com/2020/02/27/business/what-is-a-stock-...
I see, there was a similar drop in 2018. So not really that great of a fall.
Earlier quoted context omitted.
I'm in an interesting position related to this. In Canada, most people lock into their mortgage rate for 3-5 years. After that, you've got to renegotiate a rate but you're also free to switch banks. It's like starting over again at whatever you currently owe. I locked into mine 4 and a half years ago, so renewal is coming up this summer. Meanwhile, my home's value has skyrocketed (thanks to an insane Toronto housing…
Just pay off your mortgage and focus on things that you do understand well. It would not be prudent to invest the majority of your wealth into a recently broken bull market trend and try to catch the falling knife so to speak. The markets could recover in 10 years, or they could bleed out for another 10 years. If you actually had any inkling of which way the markets would move... you'd be retired already.
I believe it does make sense to invest what you can now in a balanced and diversified 60/40 portfolio. The current market turmoil is mere noise in the long term.
The fundamentals are still solid. Companies continue to make profits and hire people.
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This doesn't explain why rates change. The delta can only ever be explained by people choosing to buy bonds instead of what they previously owned, or vice versa. Those people are definitely not trying never to lose any money at any cost, or they'd have bonds all the time and rates would never change.
Rates and prices reflect confidence in the future - essentially faith in the system.
I'm about to start investing with lump sum next week since stocks looks cheaper. I was thinking to go with 80% SWDA (global stocks [1]) and 20% AGGU (global bonds[2]). I'm a non US resident. - Should I consider to take less bonds? - Is lump sum a good idea, or should I DCA? [1] https://www.ishares.com/uk/individual/en/products/251882/ish... [2] https://www.ishares.com/uk/individual/en/products/291772/ish...
If you’re canadian I can recommend a couple of blogs I follow, otherwise I’m sure there are others from your country with specific advice.
If all else fails, paying a for-fee advisor that doesn’t sell funds can help you setup a plan for yourself.
It's worth noting that most people nowadays don't buy bonds directly, you would normally hold them through an ETF/index fund like BND or TLT. Yields typically drop when there's a flight to quality (i.e., people selling stocks to buy bonds). The upward pressure on bond prices drives yields down because people are willing to pay more for lower yields. Bonds are almost like a future of expected return on capital. If bon…
Also you can buy iBonds and TIPS, which are protected against inflation.
Earlier quoted context omitted.
I'm in an interesting position related to this. In Canada, most people lock into their mortgage rate for 3-5 years. After that, you've got to renegotiate a rate but you're also free to switch banks. It's like starting over again at whatever you currently owe. I locked into mine 4 and a half years ago, so renewal is coming up this summer. Meanwhile, my home's value has skyrocketed (thanks to an insane Toronto housing…
Just pay off your mortgage and focus on things that you do understand well. It would not be prudent to invest the majority of your wealth into a recently broken bull market trend and try to catch the falling knife so to speak. The markets could recover in 10 years, or they could bleed out for another 10 years. If you actually had any inkling of which way the markets would move... you'd be retired already.
Yeah, this is exactly what my sane, smarter wife says. I briefly worked in a startup that built tools for professionals in the finance world. What I mostly learned there was that I knew nothing.
I'm about to start investing with lump sum next week since stocks looks cheaper. I was thinking to go with 80% SWDA (global stocks [1]) and 20% AGGU (global bonds[2]). I'm a non US resident. - Should I consider to take less bonds? - Is lump sum a good idea, or should I DCA? [1] https://www.ishares.com/uk/individual/en/products/251882/ish... [2] https://www.ishares.com/uk/individual/en/products/291772/ish...
It's worth noting that most people nowadays don't buy bonds directly, you would normally hold them through an ETF/index fund like BND or TLT. Yields typically drop when there's a flight to quality (i.e., people selling stocks to buy bonds). The upward pressure on bond prices drives yields down because people are willing to pay more for lower yields. Bonds are almost like a future of expected return on capital. If bon…
I would argue this is true for all investments that are judged by their ability to make money.
Earlier quoted context omitted.
The recent drop happened in only one week, it was really abrupt and breaking records. GFC didn't happen over 1 week, the bear market from GFC was from October 9/10, 2007 to March 9, 2009.
I don't think it broke any real records, the only one is the absolute point drop in the indexes, but that's a meaningless stat that will constantly be broken in the future as the economy grows - proportion is what's interesting.
It's worth noting that most people nowadays don't buy bonds directly, you would normally hold them through an ETF/index fund like BND or TLT. Yields typically drop when there's a flight to quality (i.e., people selling stocks to buy bonds). The upward pressure on bond prices drives yields down because people are willing to pay more for lower yields. Bonds are almost like a future of expected return on capital. If bon…