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    #76
    Originally posted by TexasHusker View Post
    Everyone's situation is different. Everyone's objectives are different. If you are in capital preservation mode, with the opportunity of some gains, I think index funds are a decent choice. Although a protracted bear maket is looming in my humble opinion.
    Since holding lots of equities in capital preservation mode is considered Very Unwise, we need to clarify which kind of index funds you refer to: equity or bond?

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      #77
      Originally posted by Nutria View Post
      Since holding lots of equities in capital preservation mode is considered Very Unwise, we need to clarify which kind of index funds you refer to: equity or bond?
      I think index equities are so diluted that your risk of losing much over a few years' horizon is very small. I would be much more leery of a bond fund - if interest rates start rising you could lose a bunch.

      Never been a bond fund fan - you aren't really getting the underlying yields because the fund rarely holds them to maturity.
      Never underestimate the power of stupid people in large groups.

      -George Carlin

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        #78
        Originally posted by TexasHusker View Post
        I think index equities are so diluted that your risk of losing much over a few years' horizon is very small.
        Unless a protracted bear maket hits.

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          #79
          Originally posted by Nutria View Post
          Unless a protracted bear maket hits.
          if it's a grizzzly.
          Never underestimate the power of stupid people in large groups.

          -George Carlin

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            #80
            Originally posted by Nutria View Post
            Unless a protracted bear maket hits.
            yeah, i think he should check out some s&p charts running back 10 years

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              #81
              Originally posted by ~bs View Post
              yeah, i think he should check out some s&p charts running back 10 years
              How about the DJIA of the 1960s? Only 1.79% APY. Inflation adjusted, it was a negative 0.77% APY. The inflation adjusted S&P 500 APY of the 1960s was 1.7%. Not a bear, but the same inflation-adjusted yield as a passbook savings account.

              But if you want just the past 10 years, then we're due for another collapse and 6 years to get back to the pre-collapse S&P high.

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                #82
                Here's what you'd get if you put $5k/mon into the SP500 over the last 20 years.

                value = $2,469,394
                paid= $1,190,000
                inflation = $373,145
                real extra money = $906,249

                Not too bad at all. It's correct too since hindsight is 20/20.

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                  #83
                  Originally posted by sv2007 View Post
                  Here's what you'd get if you put $5k/mon into the SP500 over the last 20 years.

                  value = $2,469,394
                  paid= $1,190,000
                  inflation = $373,145
                  real extra money = $906,249

                  Not too bad at all.
                  Meh. That's just a 3.72% APY. Nothing to sneeze at, but definitely not the 5.87% APY that the index grew in the past 20 years.

                  Which isn't the "historical 8% yield" that people bandy about. (The actual S&P 500 yield since the beginning is 5.55%.)

                  Here's the chart I use, and the APY formula is:
                  Code:
                  years=88.5
                  start=19.
                  end=2099.
                  (math.pow(end/start, 1/years) - 1) * 100
                  It's correct too since hindsight is 20/20.
                  Since $5,000 / month * 12 months / year * 20 years = $1,200,000 not $1,190,000 I question the accuracy of your numbers.

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                    #84
                    Originally posted by sv2007 View Post
                    Here's what you'd get if you put $5k/mon into the SP500 over the last 20 years.

                    value = $2,469,394
                    paid= $1,190,000
                    inflation = $373,145
                    real extra money = $906,249

                    Not too bad at all. It's correct too since hindsight is 20/20.
                    It's not too bad, but it's not too good, either.
                    Never underestimate the power of stupid people in large groups.

                    -George Carlin

                    Comment


                      #85
                      Originally posted by Nutria View Post
                      Since $5,000 / month * 12 months / year * 20 years = $1,200,000 not $1,190,000 I question the accuracy of your numbers.
                      Oh, actually calculations stopped on 3/2016 because of a lack of data. I wrote the program a while ago. Otherwise, the numbers are pretty accurate and account for commissions and ETF costs.
                      Attached Files
                      Last edited by sv2007; 06-07-2016, 02:25 PM.

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