If You Don’t Sell, Did You Lose Money or Not?
Commentary
Last year, the stock market was down big. The exchange-traded fund that mimics the tech stocks on Nasdaq (QQQ) was down 19.8 percent. The bond market also took a dive since the Federal Reserve moved aggressively to raise interest rates.
For what it is worth, statistically there is only a 9 percent chance of the market being lower again this year. Of course, based on conditional probability theory, if it is down this year ,it is likely to be down more than last year.
If you didn’t sell any stocks or ETFs last year, did you lose money or not? If you owned a bond that paid 4 percent interest before the Fed began raising interest rates and you didn’t sell, did you lose money or not?…