Does it make sense to overpay mortgage?

Sarenco

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if you invested $10000 today , would you be content for it to be worth $12954 on september 1st 2027 ?
What has that got to do with the topic under discussion? You said that non-US stock markets had "barely moved" since 2007 - which is very obviously untrue.

In any event, 10-years is a short time in the stock market - there have been plenty of 10-year periods where equities have produced lower returns than the last 10 years.

Whether I am "content" with the market return is beside the point.
 
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Sarenco

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the same sum invested in the best paying savings account in sept 2007 would have delivered as big a return as some of them were paying 4% around 2011
Yes, I often make the point on here that it is not particularly unusual for the return on short-term fixed income instruments (including deposits) to beat the return on equities over surprisingly long time periods. What of it?
 

galway_blow_in

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What has that got to do with the topic under discussion? You said that non-US stock markets had "barely moved" since 2007 - which is very obviously untrue.

In any event, 10-years is a short time in the stock market - there have been plenty of 10-year periods where equities have produced lower returns than the last 10 years.

Whether I am "content" with the market return is beside the point.
my original point was that lower interest rates tend to entice people to invest in risk assets , this post was in reply to the poster who argued a low interest rate was no reason to believe the return on equities would be any higher than normal , if you think the return of the last ten years is nothing unusual and you may be right , is it not the case that markets are due a better coming ten years , the market in three of the large economies in europe ( france , italy , spain ) have barely budged in twenty years
 

Sarenco

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What are you talking about?

Those charts show that there have been dramatic movements in each of those markets since 2007!

In any event, what have the movements in any particular market got to do with the subject matter of this thread?
 
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cremeegg

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in reply to the poster who argued a low interest rate was no reason to believe the return on equities would be any higher than normal
If this is my point in post no. 61 above that you are referring to, that is not exactly what I said. I was suggesting that interest rates are expected to be low in the coming years, and that that indicates that equity returns may also be low as both are connected to the risk free rate of return.


is it not the case that markets are due a better coming ten years
Markets are never due anything. The past is no guide to future performance.
 

galway_blow_in

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If this is my point in post no. 61 above that you are referring to, that is not exactly what I said. I was suggesting that interest rates are expected to be low in the coming years, and that that indicates that equity returns may also be low as both are connected to the risk free rate of return.




Markets are never due anything. The past is no guide to future performance.
of course , that is true but has there ever been a period where markets underperformed in europe for more than twenty years as has happened since the year 2000 , even the FTSE isnt up that much since the turn of this century , emerging markets are below where they were ten years ago as well , granted they went up by a huge amount since the mid nineties until prior to 2008
 

Sarenco

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Under-performed what exactly?

The Nikkei has yet to surpass the heights reached in 1989 (when Japan was, briefly, the largest stock market in the world). What of it?

If your point is that investors should only invest in stocks for the long-term and should always diversify widely accross companies, sectors and regions, then we are in full agreement.

If you are making some other point that has some relevance to the topic under discussion, can you please be more specific?

Are you suggesting that you have some key to outperforming the global equity market based on macro trends that are known to all investors?

I'm not trying to have a go - I'm genuinely at a loss as to what point you are trying to make.
 

galway_blow_in

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What are you talking about?

Those charts show that there have been dramatic movements in each of those markets since 2007!

In any event, what have the movements in any particular market got to do with the subject matter of this thread?
they also show no gains worth talking about since 1997 in the case of italy and spain , you earlier denied markets have gone nowhere in the past twenty years
Under-performed what exactly?

The Nikkei has yet to surpass the heights reached in 1989 (when Japan was, briefly, the largest stock market in the world). What of it?

If your point is that investors should only invest in stocks for the long-term and should always diversify widely accross companies, sectors and regions, then we are in full agreement.

If you are making some other point that has some relevance to the topic under discussion, can you please be more specific?

Are you suggesting that you have some key to outperforming the global equity market based on macro trends that are known to all investors?

I'm not trying to have a go - I'm genuinely at a loss as to what point you are trying to make.
with respect sarenco , i did quote cremegg with my last post , i dont work in finance , im just interested in it , you seem to think its normal that fixed income does as well as equities since the year 2000 , i just must believe that that must change in the future as equities are meant to significantly beat savings or treasuries over the long term and twenty years is a long time , it looks to me like equities are seriously overdue a long bull run in equities in europe , you probably forgot more than il ever know about these things but im entitled to offer opinions , the charts i provided with regard spain and italy in particular show their markets no higher than in 1999 , they are two large european economies , thats a fact , if my posts are that irritating to you , there is an ignore button

i wont contribute to this particular thread anymore however , i do not want to derail it as that appears to have happened
 

Sarenco

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they also show no gains worth talking about since 1997 in the case of italy and spain , you earlier denied markets have gone nowhere in the past twenty years
Sorry Galway but you said that those markets had "barely budged" in 20 years. That is not true and the charts that you posted amply demonstrated that it is untrue. You now seem to be saying something different.

You take the view that we will now see a long bull run in European equities because such a run is "seriously overdue". That's not the way markets work but you are certainly entitled to your opinion.
 

RedOnion

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even the FTSE isnt up that much since the turn of this century
Probably worthy of a thread of its own, but you have to understand how these indices are composed, and how they change over time to know what to expect.
For example the FTSE 100 reached a peak in Dec 1999 that wasn't reached again until Feb 2015. At that time, only 49 of the companies from 1999 were still in the list. Some had disappeared, some had been bought privately, and others had just shrunk. In 1999 the index was weighted heavily by tech and telecoms (BT and Vodafone made up 16%), then by financials, and then by commodities. It's easy to see how it's performed historically when you see small sectoral concentrations that weigh heavily.
I'm not as familiar with CAC, but again it's just 40 companies dominated by Telco's, autos and fashion brands. All have had their problems in the last 10 years.
 

cremeegg

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Sorry Galway but you said that those markets had "barely budged" in 20 years. That is not true and the charts that you posted amply demonstrated that it is untrue. You now seem to be saying something different.
I have no idea what point is being made here or indeed disputed, but the first link GBI posted showed a market at over 15,000 in 2007, which fell below 7,000 and is now at about 12,000. While there has been plenty of movement along the way, "barely budged" seems a fair comment overall, on the 10 years.
 

galway_blow_in

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I have no idea what point is being made here or indeed disputed, but the first link GBI posted showed a market at over 15,000 in 2007, which fell below 7,000 and is now at about 12,000. While there has been plenty of movement along the way, "barely budged" seems a fair comment overall, on the 10 years.
actually cremegg i was trying to illustrate ( with that FT link ) how spain , italy ( and to a lesser degree france ) have barely moved in nearly twenty years , let alone since 2007 , i stand by that

broke my pledge not to comment again here but just wanted to clarify

i do accept that most funds or etf,s which covers europe have a disproportionate tilt towards the uk so spain , italy and france would perhaps not hugely effect the performance of broad based european funds but even the FTSE hasnt rose that much since 2000 , germany is the outlier

people often talk about the performance of emerging markets in isolation , why cant europe be looked at in isolation too , almost as if if the usa has a good run , europe is included as also having done well , europe always goes down if the usa does but doesnt alway go up , perhaps that might change but while all the chat on cnbc etc right now is how europe is a better bet going forward , this is more the case for americans who have seen a miles better return on european investments due to the very large fall in the dollar , you would almost think americans are in a very advantageous position most of the time over europeans when it comes to equities

example

january 1st a guy sitting in new york buys a dollar denominated etf which tracks the s+p , today he is up nearly 11 %

january 1st a guy in new york buys a dollar denominated etf which tracks the european market , today he is up nearly 19%

january 1st a guy sitting in dublin buys a euro denominated fund which tracks the s + p , today he is down nearly 2%

january 1st a guy sitting in dublin buys a euro denominated fund which tracks the overall european market , today he is up around 4.5%
 
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Sarenco

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I have no idea what point is being made here or indeed disputed, but the first link GBI posted showed a market at over 15,000 in 2007, which fell below 7,000 and is now at about 12,000. While there has been plenty of movement along the way, "barely budged" seems a fair comment overall, on the 10 years.
I am genuinely puzzled how you could say that index has "barely budged" over the last 10-years period - your figures show very material changes over the period.

FWIW, since 1998 MSCI France has grown at an annualised rate (NR) of 4.27%, MSCI Spain has grown at 4.13% and MSCI World has grown at 4.78%.

For the avoidance of doubt, I am not suggesting that there is anything actionable in that information.
 
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