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The risk for an investor is the chance of losing purchasing power combined with the size of that loss.

So if I keep my money in cash, there is a significant risk that it will decline in real value due to inflation.

If I have a diversified investment in the stockmarket, there are a number of sources of risk - inflation being only one of them.

The longer I invest in either cash or equities, the lower the risk involved.

Is there any data available comparing the real returns on equities and bonds over the past 100 years or so ?

What was the worst outcome ? What was the longest period for a loss in real value in the stockmarket ? For example, if I invested $100 just before the 1929 crash, how long did it take for my investment to recover to its real value ? What was the largest loss in real value ? I read an earlier post in this forum that equities lost 75% of their real values twice in the last century ? When did these losses occur and how long did they last ?

Is there similar data available for bonds ? What was the longest period of loss in real value ? What was the largest loss ?

Is there similar data for other countries ? Presumably the real losses in the Japanese stockmarkets have been huge in recent years.


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