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They aren't. Well not necessarily.
The spurious argument used by academics is that in 'the long run' stocks pay higher returns than bonds. But then tell that to shareholders of Lehman who now have $0, or even Citibank who had shares worth $60 in 2007 and are worth $3 in 2009.
Like any investment, timing is the answer. The 60 year old who had 100% of his/her money in stocks and has to retire in 2009 is in deep trouble. The 60 year old who was in US Treasuries (government bonds) is safe, or better, has actually made money in this crisis of 2007/20??.
What else can I help you with?
What is better for retirement stocks or bonds?
If you're a long way from retirement, stocks (riskier) is probably better. As you get closer to retirement, high grade, short term bonds (less risky) are better.
Which is more liquid stocks bonds?
Stocks are considered much more liquid than bonds. This is because stocks are riskier and the value of the stock is determined by the present market.
Difference between stocks and bonds?
stocks are stocks and bonds are bonds . flatout -ashes
What types of investments would you suggest for a friend who is afraid to take chances with his money?
Bonds, or better yet a mutual fund that invests in bonds. They pay less than stocks, but they are much safer.
Do corporations issue stocks and bonds?
They do in fact issue stocks and bonds.
What is more risky stocks or bonds?
Stocks.
Which is better bonds or stocks?
If you are a medium to high risk investor then Stocks are good for you If you are a low to medium risk investor then Bonds are good for It all depends on how much of a risk you can take. By investing in stocks you may make profits but you may incur losses as well. But in case of bonds the profits might be less but they are assured.
Which earns interest stocks or bonds?
bonds
Why are federal securities such as bonds popular with investors?
Federal securities such as bonds are popular with investors because it is safer than stocks. It also yields higher interest rates per year than other instruments such as T-bills or stocks.
Why are federal securities such bonds popular with investors?
Federal securities such as bonds are popular with investors because it is safer than stocks. It also yields higher interest rates per year than other instruments such as T-bills or stocks.
What is stock exchange and what is stocks and bonds?
A stock exchange is a place where stocks are traded. Stocks are shares of a company. Bonds are like a loan to a company.
Why buys bonds and not stocks?
Bonds and stocks serve different purposes to the investor, and ideally you should buy both. Advantage of investment-grade bonds: the issuer is committed to paying you a stated amount of money on a stated date. The disadvantage is your return is limited to the agreed-on amount. Advantage of stocks: potentially unlimited return on your investment. The disadvantage is there are no guaranteed returns with stocks; you could potentially lose everything you invested in them. Speculative-grade bonds, or "junk bonds," have a risk/reward system more like stocks than investment-grade bonds.
