“Risk-averse investors sank hundreds of billions of dollars in bond funds and cash-like vehicles last year, missing out on much of the gain from frothy equity markets. The MSCI World index of the biggest listed companies in 23 developed markets returned 27.7 per cent in 2019, its best annual performance for a decade. Yet investors spent most of the year drawing their savings from equity funds and pouring them into fixed-income and money market funds.”Financial Times 2/3/2020*FT articles become hard to access after a few hits. Clearing recent items in cache helps.
Comments
From the article, end statement: "He added that much of the money pouring into bond funds was part of a demographic trend, where older investors were taking less risk with their pension savings."
This reads as a reasonable investing consideration statement. Then I must presume these investors are retired and pension savings means monies within their control. I will also presume, for the sake of my simple math below; that the money is mostly in IRA accounts that had prior direct investments or have been rolled into from company plans.
--- Assumptions:
1. The first U.S, baby boomers starting retiring (age 65 assumed) in 2011, at a reported rate of 10,000/day (don't know if this is everyday or only Monday - Friday).
2. This results in 3.65 million/year or 32,850,00 since 2011.
3. Assuming not a large percentage of these folks have saved much, and also assuming 25% of these retires may have $200,000 each; the most simple math may indicate 8,213,000 individuals having $200,00 each in accounts they control, finds a value of $1.64 trillion.
I don't have a problem with the quality of FT writings. But, the article notes $4 trillion of monies. Wishing there was a more defined path of where the $4 trillion arrived.
Lastly, I still don't know what the word "investors" fully encompasses in these articles. Would be nice if there was a footnote defining the word as used in a particular write.
LARGE DISCLAIMER: I'm using an OTC med to help control a maximum stuffy cranium area. By reading this far into the document, you have, unknowingly, signed electronically a "hold harmless" agreement that what I wrote may or may not make sense.
Now to the recliner chair.
Catch