Tsumitate Wrestler wrote: ↑Mon Oct 28, 2024 12:52 am
Deep Blue wrote: ↑Sat Oct 26, 2024 12:37 pm
Bubblegun wrote: ↑Sat Oct 26, 2024 11:44 am Thanks for that. Currency risk was never in my thoughts with bonds.
People here are overly fixated with it I believe. It really is no more of a risk than with equities.
That’s precisely the issue.
Bubblegun operated under the assumption that shifting from equities to bonds would eliminate risk entirely. However, this only mitigates investment risk while still leaving currency risk.
Yen-based investors, however, face limited de-risking options: they must choose between accepting currency risk on foreign assets, bearing market risk with foreign equities, or settling for low to no yield on domestic treasuries.
When de-risking for retirement, these risks can’t be dismissed, especially amid dramatic interest rate shifts and volatile currency pairs.
I think we can agree that BOTH have risk.
Staying in stocks has a stock price risk and a currency risk.
The bonds have less price risk but still keeps the currency risk.
So I guess this is about “reducing the risk” because we can’t eliminate the risk.
Now if , as some say, future returns on the s&p500 might be only 3% annually over the next decade then who knows what is better. One thing I guarantee is, there will be a correction and a crash. But all the gurus on the news are just chosen to grab the headlines, put up the fear or the hype. News shows really don’t want some guy on saying, it’s gonna be “normal”
Which really mean he has no idea.
So what do we do.
Well I’ve chatted with the better half and I forgot we actually bought one of those Japanese investment, saving policy thingy me bobs, which will guarantee 10, million yen no matter what happens to the currency or stock market. So I guess I can think that appears more like a bond without the currency risk.
We bought as we were heavily in stocks. Or rather she chose it because we are heavily in stocks. It was originally bought to pay for college. And if I die it’ll still pay out 10 million.
I have no idea what they are called in Japan.
Baldrick. Trying to save the world.