Was my short term bond fund a mistake?

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So, two years ago, I made hundreds of thousands of dollars in the crypto bubble and then lost most of it when the bubble popped. After that, i decided to take my ball and go home. I took what was left ($80,000) and put it into Vangaurd's Short Term Investment Grade Bond Mutual Fund. The reason i chose a bond fund was that this was only supposed to be a temporary and safe holding place until i could get this money invested in real estate. Well, things didn't turn out as planned.

It took me a year before i bought my first investment property, and another year has passed in which i’ve been unable to qualify for a loan. In the meantime, i’ve saved most of my low wage W2 income and all of my investment income. Now i have $125,000 sitting in my bond fund and high yield bank accounts, which is obviously not ideal and not what i’d anticipated two years ago when i started this fund.

What i want to know is, what do you think i should have done differently and what should i do differently going forward? During the past year, Vangaurd’s total stock market fund is up 30.8%, their long term investment grade bond fund is up 20.41%, and the short term investment grade fund that i have money in is up only 5.74%. I lost a lot of money by not putting it in the long term fund rather than the short term fund, and even more by not putting it in stocks.

Yet, i’m not sure that either of these things were really a mistake. I think my problems with loan qualification were largely unforeseeable and due to bad luck. Furthermore, I really want to invest in real estate, and if i’d put it in stocks and the stock market had dropped, i’d be kicking myself, while if i’d put it in bonds and the stock market had dropped, i’d be patting myself on the back. As far as short vs long term bonds go, the difference in SEC yield between the two is less than 1% right now, so I’m not sure that i could have anticipated that one would do so much better than the other, particularly within such a short time frame. Then again i don’t know much about bonds so i could be wrong.

Going forward, i think that having more money than i’m able to invest in real estate is going to continue to be a problem for me. Even if i buy a couple investment properties this year, i’m going to have to decide where to keep the rest of my excess money.

You didn't make a mistake, you didn't lose money, there will always be another investment that would have done better, so you can't compare yourself to that.  Also your plan was to spend the money in the near future, so keeping it in a less volatile asset class was most likely the best move at the time.