The Close Race Between Stocks and Bonds

Here’s a graph that tells a lot and every investor should remember this lesson. The following chart shows the total return of stocks (blue) along with the total return of long-term corporate bonds (red). The data begins in October 1986.


What you can see is that the two lines follow each other pretty closely. Over the last 27 years, stocks and long-term bonds have performed about the same. Despite stocks running ahead of bonds in 1987, the late 1990s and again last decade, the two lines have always come back together.

Posted by on September 30th, 2013 at 1:26 pm

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