Hey gang,
I am trying to find a mutual fund that mimics the US Bond market. I have Schwab, and so their Schwab Total Bond Market Fund (SWLBX) is the one I'm looking at. When I compare it to the other funds that mimic this market (it's the blue line), the 1- and 5-year look fine:
However the longer term shows a dark, ugly secret:
Can someone who actually understands this stuff please try to explain this to me in simple terms? It looks as if SWLBX never recovered from the 2008 crash; interestingly, it started going south months before the September 2008 crash unlike its buddies. But otherwise, it has the same ups/downs as its buddies.
1) Why couldn't it recover during 2008, when its buddies could?
2) Is it therefore more likely than its buddies not to recover from the next big market crash -- and so I should avoid it as a long-term bond market index fund?
Thanks for your help!