Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
The last 4 years have been dubbed 'the most unloved bull market in history'. There is still a lot of run left in this old bull, partly because so many people have sat on the sidelines the last four years, either permanently scared of another 2007-08 or convinced by the political commentators that the end of the world is at hand. This has been good for the rest of us, since we have benefitted from a lack of herd instinct to put money into stocks. This may be shifting a little bit, but my insight is that the money being pulled out of bonds is going to cash (sigh!), not into the stock markets.
We have had more than one client who pitched a fit not too long ago that they did not want any money in stocks, just bonds. And now they are calling to ptich a fit about their 'safe' bonds losing values, forgetting that we have been telling them this would eventually happen. They forget that long-term Treasuries have durations of around 15 years. They look at that and think that is the worst event possible. But we remind them the S&P 500 lost 37% in 2008 and SDY lost 23%, a whole lot worse than the potential loss on long-term bonds today.
But, yeah, there is not a lot of respect for the 4-year old bull market.
Comments
We have had more than one client who pitched a fit not too long ago that they did not want any money in stocks, just bonds. And now they are calling to ptich a fit about their 'safe' bonds losing values, forgetting that we have been telling them this would eventually happen. They forget that long-term Treasuries have durations of around 15 years. They look at that and think that is the worst event possible. But we remind them the S&P 500 lost 37% in 2008 and SDY lost 23%, a whole lot worse than the potential loss on long-term bonds today.
But, yeah, there is not a lot of respect for the 4-year old bull market.