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How to Sell Gold Jewelry as Price Nears Historic High
Global events are driving up the price of gold as people look for stable investments. We tell you how to make money off your gold jewelry.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
Bond Advice for Today’s Market: Think Big Picture
There is an old joke that some statisticians tell, that âa person with their head in an oven and their feet in the freezer is comfortable â on average.â Statisticians are not known for their sense of humor (clearly), but the joke is an effective warning about some of the shortcomings of relying on averages.
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Statistically, a simple average camouflages extremes within its sample data. And, while the statisticianâs joke is somewhat extreme, it is no less extreme than the actual returns in the long-run average annual returns for stocks and bonds that set many investorsâ return expectations.
Whatâs an ‘average’ annual return anyway?
If quizzed, it is likely that many investors would estimate the average annualized returns for U.S. stocks and bonds to be about 10% and 5%, respectively. Those averages are composed of decades of returns and describe history perfectly. However, although they describe the average annualized returns, they are a far cry from the typical or “average” experience. Â In fact, in only two years from 1926 through 2020 did both the stock and bond market deliver returns within 2% (+/-) of their historical averages (see Figure 1).
Figure 1: Annual stock and bond returns, 1926-2020
Source: Liberty Wealth Advisors, using data from Morningstar Direct
In 2021, U.S. stocks  gained 25.7%, while U.S. bonds lost 1.5%.* While it is fair to say that it was a great year for stocks, is it fair to say that it was a bad year for bonds because they didnât return their 5.7%* average?  Probably not. The only thing rarer than a year with âaverageâ returns might be a year that investors appreciate their bond allocations amid a bull market for stocks.
For those of you thinking about abandoning bonds, here are some ideas that may help:
A bad day for stocks is often much worse than a bad year for bonds.
While investors prefer gains to losses, they also prefer small losses to big losses. While far from being predictive, Figure 1 demonstrates that negative returns in bonds have tended to be both infrequent and modest. In fact, the bond marketâs worst annual return was a loss of 5.1% in 1994. However, the stocks of the S&P 500 index have posted daily losses that bad or worse 25 times since 1926.
Sometimes, the further the distance, the clearer the picture.
Often, itâs hard for investors to see the benefits that high-quality bonds can add to their portfolios, especially when the returns they are posting are modest â or even modestly negative. And today, concerns for higher interest rates due to higher-than-expected inflation are making it even more challenging for investors to ignore some punditsâ suggestions that holding bonds is a bad idea.
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I was given a magnifying glass when I was young, and I started looking at everything through it. Eventually, I looked at the Sunday comics and realized that for all I saw, I wasnât seeing everything. The cartoons were nothing but a variety of colored dots! Magazine photos, too. It made me wonder how much else I was missing because I wasnât looking closely enough. Now, I realize that when I was close enough to see the dots, I missed the bigger picture â literally.
Similarly, the dots in Figure 1 paint a picture thatâs easy to overlook when youâre too narrowly focused: The principal benefit of investment-grade bonds isnât their frequency of positive returns but the infrequency of large, negative returns. And, yes, if the returns in Figure 1 were inflation-adjusted, the frequency of negative returns for both bonds and stocks would increase. However, that would not change what Figure 1 tells us: High-quality bonds in a portfolio can help moderate the volatility of stocks.
The bottom line: Keep your eye on the big picture.
A well-diversified portfolio can benefit from bonds: More likely than not, a bad year for bonds will be much better than a bad day for stocks. While that certainly wonât insure your portfolio against losses, it can certainly help moderate the losses when the markets turn intemperate.
Having a well-diversified portfolio that includes an allocation to high-quality bonds can help keep a bad day in the stock market from turning into a bad year for your portfolio.
* Stock performance as measured by the CRSP U.S. Total Market Index. Bond performance as measured by the Bloomberg U.S. Aggregate Float Adjusted Index. Bond average is a geometric mean return for the Ibbotson® SBBI® U.S. Intermediate-term (5-Year) Government Bonds (Total return).
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The Pros and Cons of Living in a Studio Apartment
Thinking about living in a studio apartment? Here are some things to consider.
The post The Pros and Cons of Living in a Studio Apartment appeared first on The Rent.com Blog : A Renterâs Guide for Tips & Advice.
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How to Unshrink a Sweater That You Still Want to Wear
It can happen without you even realizing it: You dump a load of laundry into your apartment building’s commercial washing […]
The post How to Unshrink a Sweater That You Still Want to Wear appeared first on Apartment Living Tips – Apartment Tips from ApartmentGuide.com.
By: Sirenbliss
Horrible experience with a radio station. I owed a 100 dollar bill, and got overwhelmed financially. I am not sure how to handle them now because — the debt, a year old now — is trying to be recovered by someone at the radio station who is calling associates of mine trying to find my name and number … people have been contacting me telling me the collector verbally stated that I owe them money and are trying to collect. Anyway — I am exhausted. Because its a business debt its not protected under the FDCPA. Does anyone know what other protections might be available to me legally? I am contacting an attorney to have them write a cease and desist letter for defamation. Thanks … any thoughts would be appreciated
How to Quit a Job
No time to burn bridges: Hereâs how to quit a job and advance your career without creating workplace drama that could boomerang on you.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
25 Uses for Peanut Butter Beyond PB&J
Even if you donât enjoy eating it, these five alternative uses for peanut butter make it worthwhile to keep a jar around.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.