Right now it seems money is still pouring into the stockmarket. Stocks Still Better Than Bonds ? Well here are some facts that will help you decide.
Stocks Still Better Than Bonds |
Studies are now suggesting that there is a far better chance that stocks will be better than bonds in the next 5 to 10 years.
WHY? What is happening right now is that there is a shift in the fundamentals and current yields, and brokers and investors are starting to notice it. Some of the stocks are yielding at 2.2 percent, and do have massive earning potential, or growth potential at the moment. The government has no other option but to pay upon the agreed coupons.
Investors are also slowly realizing the upside in the market could continue as there is still a lot of money on the sidelines doing nothing. Once this money starts shifting back in, it will have a positive effect on the global markets. But astute investors are still looking for a reason to get back into stocks.
Stocks Still Better Than Bonds when you look at it on a grand scale because some stocks, have earnings growth of about 5% in the next 10 years. Normally the real returns are a little bit higher on average, around the 6.5 - 7% range. But that also depends on the market conditions and valuations in the years ahead.
Looking into the crystal ball in 2012 is probably quite dangerous, as there are many discrepancies with the real economy and issues surrounding currencies and the market itself, however normally when you look at these hard core facts, especially in the past, it is easy to predict whether prices were most likely to go up, down or stay flat in the longer term. Right now things seem to be pointing in a positive direction.
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