jdrmlr wrote:Is it a good time to buy VGPMX since it is the only Vanguard stock fund that is down year to date ? Would this fund be a hedge against future inflation after the fed is done with its' printing money ?
"Stay-the-course is the most important piece of wisdom I can give you."
Too good to be true, really—a long-term real rate of return of nearly five percent, within shouting distance of industrial stocks—and that’s before the five percent "rebalancing bonus." One doesn’t need to fire up an optimizer to realize that this asset class, with its 0.29 correlation with the S&P, belongs in every portfolio.
As you might suspect, there’s a price to be paid. You think that value and small-stock exposures were a tough row to hoe in the 90s? Have Japanese stocks given you fits for the past 15 years? You ain’t seen nothin’: since 1963, the precious metals equity (PME) series has lost more than 35% five different times and, on one occasion, nearly 70%. Between October 1980 and August 1998, it lost a total of 53.8%, or 4.2% annualized—a 7.7% annualized loss after inflation. For the more than 24 years between October 1980 and December 2004, the real return of PME was –0.3%.
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