The graph above represents the market returns and volatility over the ten years ending in 2009. It was created on Yahoo, in their finance section, using their interactive graph feature.
Here's what you're looking at:
- Blue section: represents the S&P 500 Index
- Green line: represents the International Markets. Symbol EFA is an exchange traded fund, specifically iShares MSCI EAFE. EAFE stands for Europe, Asia, Far East. MSCI stands for Morgan Stanley Capital International.
- Red line: Dow Jones Industrial Average
- Brown line: represents Vanguard's Total Bond Market Index
Despite all the media induced drama, over the decade, you didn't lose if you maintained a diversified portfolio, and made sure to rebalance it along the way.