Pastcaring wrote:
Then the GFC came, the price went down to $17 a share, the crowd that haven't got a clue what that company does all pat each other on the back . Look, we didn't buy them, we are clever.
How they didn't notice that their well diversified index fund crashed by 50% is beyond me. Why they still deny it is beyond me.
Their well diversified fund has done nothing virtually for the last 12 years.
Here's a Yahoo Finance chart (https://tinyurl.com/y6mngmf9) for the FTSE100 between April 2005 and 26th April 2019 -
The above chart shows that in November 2007, the FTSE 100 was at a level of 6721, and it dropped to a low of 3830 in February 2009, which is actually only a drop of 43%....
The November 2007 level of 6721 was reached again in November 2013, so only six years passed between the pre-GFC level and the FTSE100 regaining that lost ground.
Even then, that doesn't tell the whole story, because even during those turbulent years, the FTSE100 continued to pump out dividend returns, as we can see in the chart below (source - https://tinyurl.com/yys934jh) -
Looking at the above chart, we can see that the dividend-yield of the FTSE100 during the turbulent post-GFC period never dropped below 3%, and often sat happily above it....
Of course, in addition to the above, many investors will have continued to drip-feed their investments over the period where prices were lower. Such investments will have made significant gains since that time, as we can see from the above chart.
Your view that well-diversified index-funds have done virtually nothing for the last 12 years doesn't seem to reflect the reality of the above situation.
Perhaps you're thinking of a different well-diversified index-fund, in which case it would be interesting to hear which one(s) you think have done poorly, both during and since the GFC....
Cheers,
Itsallaguess