Bonds Outperform Stocks Over 30 Years

I was prompted to write this article when I recently read that, over the past 30 years, bonds have outperformed the stock market.  What makes this even more interesting is that in our recent Linkedin poll we found that only 5% of those polled invested in bonds versus 56% investing in stocks and mutual funds.

If you are like millions that have been invested in the stock market, hoping that the “buy and hold” strategy will work, this news should make you cringe.  Think about it, you would have been better off investing in those boring old bonds that nobody pays attention to instead of holding on for dear life as the market played with your money.

This is the classic battle of tortoise versus the hare and the tortoise just caught up.  The fact that bonds have edged out stocks goes against what most have been taught and at the same time makes stock investors wonder why they have endured incredible volatility  in exchange for lower returns.

So it begs the question, what is the value of having money in stocks and mutual funds?  It also points out the unfortunate truth that our nation is incredibly under-educated about stock market alternatives.

 

 

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Nick D.

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