I've been invested in VBTLX/VBMFX for some three decades now, and i know that over the long term it cycles around a central NAV of $10. Some years/decades it's above that and some years/decades it's below that. Whichever side it's on, it will eventually flip to the other side and spend some years there too. Assuming that normal market cycles continue to happen.
When it's above 10, it's relatively overvalued and you're paying more and getting less. Ironically, this is when everyone likes it and is buying it.
When it's below 10, it's relatively undervalued and you're paying less and getting more. Again, ironically, this is when everyone hates it and doesn't buy it.
Fortunately if you own it as part of a fixed percentage of your portfolio (ie, staying the course), you're automatically buying more of it when it's down and buying less (or even selling) when it's up. Which adds a little bit of a cherry to your returns over the long term.
Having said that, i urge everyone to continue to dump it, so that i can continue to make my automatic monthly investments at a lower price!
When it's above 10, it's relatively overvalued and you're paying more and getting less. Ironically, this is when everyone likes it and is buying it.
When it's below 10, it's relatively undervalued and you're paying less and getting more. Again, ironically, this is when everyone hates it and doesn't buy it.
Fortunately if you own it as part of a fixed percentage of your portfolio (ie, staying the course), you're automatically buying more of it when it's down and buying less (or even selling) when it's up. Which adds a little bit of a cherry to your returns over the long term.
Having said that, i urge everyone to continue to dump it, so that i can continue to make my automatic monthly investments at a lower price!
Statistics: Posted by MadHungarian — Mon Jul 01, 2024 7:17 pm — Replies 1 — Views 482