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Monday, October 13, 2014

Market Returns vs Fixed Income

Today the S&P 500 took a 1.65% hit, which with current annual S&P 500 returns that is a major hit.
But lets take a look on how you fared if your money was in fixed 30 year US Treasury bonds vs the market, the ROI, assuming 3.25% fixed.


Over 5.5 years a return of 19.25 % vs 203% over the same period from S&P 500 low to high.

To put into perspective, lets look at the S&P 500 during that time period.

So almost any market correction will still put market investing ahead of fixed income investing over the same period.  And that assumes all stocks owned give zero dividends.  Therefore market correction of 4.8% over the last 3 days hardly puts this into a loss category.  

GDX has been holding about flat over the same period, we will wait to see if it pans out to be a winner.
Please see post Possible Turning Point posted on October 8th before the 4.8% market correction began.   If history holds true the market will rebound this week resuming the advance.  Then again, market history is not a gaurantee rule of thumb. See post Market Dislocation if you place faith in history repeats itself in the markets.  All I know is GDX has been beaten to a pulp, thinking it can't go much lower, and what won't go down will go up or sideways :) See Gold Miner Implosion, whats up with that?

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