A Picture’s Worth a Thousand Words

Russell’s paper “The impact of staying invested during market turmoil,” certainly supports the validity of this old saying. Comparing the performance of a 60/40 portfolio to an all Treasury or U.S. bond alternative, Russell found the “stick with it” investor would be well ahead.

In the exhibit of a hypothetical 60/40 portfolio on Sept. 30, 2008 (two weeks after the collapse of Lehman Brothers and a defining moment in the recent financial crisis), we compare results. The starting point for the $100,000 hypothetical portfolio is Oct. 9, 2007, the prior market peak.

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