Which investment is typically considered safer than stocks?

U.S. Treasury bonds are generally considered safer than stocks for several reasons. They are backed by the full faith and credit of the U.S. government, which makes them one of the lowest-risk investments available. When investors purchase Treasury bonds, they are essentially lending money to the government, which has a very low chance of defaulting on its debt. This inherent safety is further enhanced by the predictable nature of the interest payments and the promise of return of principal at maturity.

In contrast, investments like common stocks and international equity funds involve higher risks due to market fluctuations, company performance, and other factors that can affect their value. While real estate investments can be relatively stable, they still carry risks related to market conditions, property management, and location dynamics, which can introduce volatility not present with Treasury bonds. Therefore, U.S. Treasury bonds are often viewed as a safe haven for conservative investors looking to preserve capital while earning interest with minimal risk.