Investors should account for the effect of higher rates as well as moderate their return expectations, says the Wall Street Journal columnist.
Money has been quickly pouring in to and out of risk assets in the bond markets recently, making for a volatile ride.
October data show continued inflows for bonds (including riskier fixed-income assets), while investors withdrew money from U.S. stock mutual funds and ETFs.
A reasonable estimate based on dividend yields, potential earnings growth, and current P/E ratios suggests a 7% annual return for stocks over the next 10 years, says the Vanguard founder.
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