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I should have bought bonds for the time being, or at least mixed them in in a relevant way?

I'm afraid I've made a serious mistake.

Right from the start, I invested 100% in shares, or rather an equity fund.

So far that would be good. In the long term, that should take me further.

However, I think I have understood that it would have been wiser to invest in long-term government bonds when interest rates were high and now to gradually shift into equities or the ETF as interest rates fall or in the stronger corrections we have seen this year.

For me, this realization came with hindsight and perhaps too late? Do bonds still make sense now? Or have interest rates already fallen too low?

However, this is the same equity/interest rate/bond cycle that has existed since Wall Street and must therefore have been foreseeable?

I think this cycle would be a functioning system. I picked that up somewhere, so it's half-knowledge, I don't know if it was YouTube video number 984 or podcast 32. In any case, you would have had a positive return with bonds over the last few months and could always have quickly switched into equities, for example in April when things went down so rapidly, and would therefore have had a much higher return afterwards. I would like you to point out any errors in my thinking and perhaps suggest a system based on this logic that can also be implemented by a layman. Many thanks in advance

7 Comentários

BockaufDividenden@BockaufDividenden

Honestly? In my opinion, bonds don't bring anything special - if you want to get interest or something through the bonds, then just take a dividend ETF, you'll get more out of it in the end

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TorteInYourFace@TorteInYourFace

At most if it had been € bonds. With USD bonds, you would have had the same currency losses as with $VUSA (which is actually at the ATH, just not for Europeans). The return on bonds in foreign currency is much more dependent on exchange rate fluctuations.

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Oleg@ScorpionfromBW

That also depends on what currency the bonds would be in. With USD bonds you would be just as much in the red as with ETFs, at least as far as YTD performance is concerned. Switch your portfolio to USD and you'll see the difference compared to EUR

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Epi@Epi

I think your attention to bonds is good. The bond market is bigger, more complex and more informed than the stock market.
But most of your assumptions don't apply. E.G.:
Bonds also fell in the customs sale. A swap would have done nothing.
Long-dated government bonds are still trading about 50% below 2021 highs. Security is something else.
Etc...

There are basically two strategies for dealing with bonds and equities:
1. 60/40 = mean reversion
2. GTAA = Momentum.

Maybe this is something for you: $NTSG?

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Tenbagger2024@Tenbagger2024

My dear, you could have switched to bonds.
So that you could write at the end of the year, "I should have stayed invested in equities".
In the long term, equities always beat bonds. Because the proportion of bear markets is lower.
An expected interest rate cut should also boost equities once again.
And in the end, nobody expected such a correction in January.
Therefore, as a long-term investor, and perhaps a buy and hold investor.
The forms of investment that are most successful

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NichtRelevant@NichtRelevant

Don't panic! A good equity ETF will generally always outperform bonds in the medium to long term. You've done the right thing, the dollar/euro exchange rate may have just hit you a little, but I would sit it out. I would stay away from hectic switching back and forth anyway, as so-called market timing hardly ever works and only causes stress and transaction costs.

I started investing in bonds in my younger years and today (if I were to start again) I would actually only invest in equities, as they perform better in the long term and ETFs allow you to diversify without taking too much individual risk.

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Matzke@Matzke

The losses of your S&P 500 ETF are largely due to the weakening dollar against the euro. Bonds denominated in US dollars would have performed just as badly. I would simply hold this ETF and buy more if possible. The dollar will probably gain strength again after US government debt refinancing. Be patient.

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