[throwaway2037]

By this dumb reasoning of unrealised losses, you should never invest in any security (bond or stock) else the exact same scenario may happy. You are destined for the poor house without taking equity index risk in this generation.

[infinite8s]

I was explaining why capital preservation is important with this (albeit) dumb example. Obviously someone with $500M is going to be a bit more sophisticated about it (there are reasons hedge funds that return 15-20% annualized charge 2 & 20 - or some now do 3 and 30 with a 5yr lockup).

[vba616]

>hedge funds that return 15-20%

This is always a scam. Madoff died in prison, you know.