With more than a month to go, 2022 is all but certain to go down as an annus horribilis for both stocks and bonds. The crucial question for investors: What does that portend for the year ahead?
The relevant funds tell this year’s sad tale. The iShares Core S&P Total U.S. Stock Market exchange-traded fund (ticker: ITOT) shows a negative total return of 16.9% from the end of 2021 through Wednesday, according to Morningstar. The iShares Core U.S. Aggregate Bond ETF (AGG), which tracks the domestic investment-grade taxable bond market, suffered a 12.9% negative return over that span. With both asset classes taking double-digit hits, the Vanguard Balanced Index fund (VBAIX), a proxy for the traditional 60%/40% stock/bond portfolio, had a 15.3% loss.