Buying Bonds Could Be the Single Most Important Investing Decision You Make for 10 Years Rob Isbitts Sat, August 15, 2026 at 7:00 AM PDT 5 min read Today's investors seem to want upside, upside, and more upside. I get it. After a generation of pathetically low interest rates and negligible returns on bonds, who can blame investors for ignoring the asset class that is actually much bigger than the stock market? More News from Barchart Elon Musk Said Tesla Short Sellers Would Be 'Obliterated' Even Bill Gates Yet They've Made $9 Billion This Year Shorting the Stock Sergey Brin Wants Google to Double Down on Gemini. What That Means for GOOGL Stock. Alphabet Stock to $515: 3 Reasons the Bull Case Is Getting Stronger Markets move fast. Keep up by reading our FREE midday Barchart Brief newsletter for exclusive charts, analysis, and headlines. However, I'm increasingly of the opinion that the U.S. Treasury Bond market might be giving away the biggest "free lunch" any of us have seen this century. There's risk to anything and everything in investing. But this might be an opinion we look back on a decade from now and realize "wow, that was a no brainer. It just didn't seem that way at the time, so many people ignored it." Here's what I'm referring to. This is a chart of the 10-year U.S. Treasury bond. As of this writing, it yields just under 4.7%. But if we look at that chart which covers the past four years of trading, we see it has been in a range from 3.6% to 4.8%. So it is toward the high end of that setup. I know that does not compare to equity returns of the past 10 years. But here's the thing about past performance: we can't have it! All we can do is look forward. And when I do that, mindful of market and interest rate history, I like my chances with a big allocation of my portfolio to bonds. A ladder in my specific case, as I've written about here several times. But that's just me. The biggest concept I'm trying to get across is to not ignore the tradeoffs in favor of a 5%-ish return over 10 years' time. Especially with the S&P 500 Index ($SPX) looking so good in the rear-view mirror. www.barchart.com The 10-year bond range is a sharp departure from the post-2008 era of 0%-2% yields. And to me, it dramatically changes the hurdle rate for equity risk. Or equity risk premium, if you will. When guaranteed government debt yields 5%, taking equity risk requires expecting a clear premium in total return. What's the S&P 500's 10-Year Return History? Looking at rolling 10-year annualized nominal returns for the S&P 500 going back to 1928 reveals clear historical frequencies: The Long-Term Baseline: The average annualized 10-year total return for the S&P 500 historically sits near 10.2% . Story Continues Frequency Above 7%: Approximately 75% of all 10-year rolling windows in U.S. history delivered...
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