The S&P 500 has essentially been flat for 10 years, staring at 1,147.39 at the outset of 2002 and reaching 1,348.08 Monday.

Nervous investors pulled $125 billion out of mutual funds that invest long-term in U.S. stocks last year. And they poured more than that into bond funds, the current ‘friend’ of investors.

But “the bond market is now a higher risk sector,’’ said Michael J. Niedermeyer, Chief Executive Officer, Asset Management Group and Executive Vice President of the Management Committee at Wells Fargo & Company.

Interest rates can’t go lower. Federal Reserve Board chairman Ben Bernanke says he will keep rates suppressed through 2014.

“The thing I'd ask him is are you crazy with these interest rates?,’’ said Alan Reid, Chief Executive Officer and Founder of Forward Management, which operates a family of mutual funds that offer investors access to investment managers who are experts in different asset classes.

Which in turn leads Michael W. Roberge, President and Chief Investment Officer at MFS Investment Management to expect a bear market in bonds and fixed-income instruments, after roughly a 26-year run.

“Investors are combating the last crisis,’’ said Roberge at NICSA’s 30th Annual Conference and Expo. They are “paying way too much for safety,’’ he said. Ten-year Treasury notes, for instance, have hovered around 2 percent, over the past year.

They will miss the equity rally of the next 10 years. “Equities will soundly outperform bonds,’’ Roberge said.

Interest rates have to increase, he said, and rising interest rates will, in effect, be the next black swan that could catch the investment industry by surprise.

Black swans are unexpected events with extreme effects on markets. The 2008 credit crisis was the last big one. The Flash Crash of May 6, 2010, was a one-day example. The term was popularized by author Nassim Taleb.

But Niedermayer takes the counterposition. He said an equity rally, also not widely expected, could be a black swan ‘good event.’’

Institutions and individuals could be “really underweighted in equities,’’ he said. And a “reversion to mean” in turn means stocks, now battered, will almost inevitably rise over the next decade.

Roberge said most investment managers are, so far, missing this inflection point. They have put $1 trillion into bond funds, worldwide, he noted. But nothing into equity funds.

His firm, MFS Investments, has begun moving its clients back into equity funds, he said.

Tom Steinert-Threlkeld writes for Securities Technology Monitor.