Vanguard founder Jack Bogle tells Morningstar that he thinks stocks will outperform bonds over the next decade — but that investors need to be able to deal with volatility if they want to profit from stocks over that period. Bogle says that while no one knows for sure what the markets will do in the future, there are “sound bases for realistic expectations about future market returns”. Bond returns, for example, are “very heavily shaped by the current interest rate”, he says. while stock returns are largely shaped by earnings and dividend growth. He says it would be reasonable to expect 7% per-year returns for stocks over the next decade, while bonds should return much less given their current low yields. But, he adds that investors shouldn’t focus on stocks if they don’t have the stomach to deal with the turbulence that he expects the market will see in the next decade.