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Annual Returns on Stock, T.Bonds and T.Bills: 1928 – Current

74 点作者 hydroreadsstuff超过 5 年前

21 条评论

darawk超过 5 年前
Do keep in mind that absolute returns are not the most important factor in investing. What you should care about are risk-adjusted returns of a particular asset, and return stability of your whole portfolio.<p>You can always use leverage to magnify the returns of any asset class up to whatever level you want. The only limiting factor there is risk and the cost of borrowing.<p>Before I learned about finance I thought that the purpose of diversification was safety. And it is, in part. But as a consequence of the AM-GM inequality [1], diversification actually increases your long-term returns. A returns stream of 8% every year will have substantially more money than a returns stream with a mean of 8%, that bounces up and down. If you play around with some numbers, you&#x27;ll quickly see how profoundly important this fact is.<p>1. <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Inequality_of_arithmetic_and_geometric_means" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Inequality_of_arithmetic_and_g...</a>
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refurb超过 5 年前
Interesting that for the 2007 financial crisis, you only had to wait until early 2012 to make up your loses.<p>Even for the crash of the early 1930&#x27;s, after 8 years you were back to where you were.
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bryanlarsen超过 5 年前
Keep in mind that these are cherry-picked, they only include American returns. The 20th century was an exceptional one for the United States. The 21st century may also be, but you should definitely be diversifying globally.<p>The worst case return definitely isn&#x27;t on this list, it&#x27;s the returns from 1914 Germany, which didn&#x27;t break even until 2014...
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jedberg超过 5 年前
Now the fun part. Pick any 30 year period, and you will beat inflation with stocks. Even if you get in at a peak, 30 years later, you will be well ahead.
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bozoUser超过 5 年前
It would have been great if someone could have also added REITs. The argument I always hear is real estate vs the stock market.
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typpo超过 5 年前
Last weekend I built an S&amp;P returns calculator that exposes similar statistics and adjusts for inflation.<p>Accounting for inflation reduces the ROI by an order of magnitude, but the result is still impressive! (36,560.12% return)<p><a href="https:&#x2F;&#x2F;www.in2013dollars.com&#x2F;us&#x2F;stocks&#x2F;s-p-500&#x2F;1928" rel="nofollow">https:&#x2F;&#x2F;www.in2013dollars.com&#x2F;us&#x2F;stocks&#x2F;s-p-500&#x2F;1928</a>
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ChuckMcM超过 5 年前
I recommend you download the spreadsheet, it can be really helpful in doing the &#x27;null&#x27; hypothesis in financial analysis. I always like to compare my choices in investments versus the &#x27;stick it into SPX500 ETFs&#x27; as the alternative. To do that you need to collect all this data, which is doable, but hey here they have it all in a nice package.
legatus超过 5 年前
I&#x27;m curious -- what does HN think of factor investing [0]? It has been shown over long periods of time to outperform the total market, and has seen many new ETFs available. Does anyone here tilt towards small cap value? Do you think those effects will last, now that they&#x27;re more widely known, or are the last 15 years evidence of them weakening? I&#x27;ve been looking into investing but I&#x27;m probably going with a total world stock market. Part of the reason I find those ETFs less attractive are the higher associated fees as well as the more &quot;active&quot; look. I have trouble believing anyone who claims there is a way to consistently outperform the market while charging me for it.<p>[0] <a href="https:&#x2F;&#x2F;www.investopedia.com&#x2F;terms&#x2F;f&#x2F;factor-investing.asp" rel="nofollow">https:&#x2F;&#x2F;www.investopedia.com&#x2F;terms&#x2F;f&#x2F;factor-investing.asp</a>
jonbarker超过 5 年前
Which 30 year period you get to live and work in is what matters most, and the timing of the bad years. Which is why I recommend this calculator: <a href="https:&#x2F;&#x2F;firecalc.com&#x2F;" rel="nofollow">https:&#x2F;&#x2F;firecalc.com&#x2F;</a>.
tunesmith超过 5 年前
I&#x27;d love to see this plugged in to a tool that asks 1) What allocation percentage of stocks&#x2F;bonds do you want, 2) What length of period in years (i.e. 20 years, 40 years), 3) What confidence level (50%, 75%, 90%) and yields what APY you can expect. (The higher the confidence, the lower the APY.)<p>I&#x27;m still convinced that the general advice out there is highly out of whack, and that someone&#x27;s expected returns should be very low. I&#x27;m currently modeling under 2% (post-inflation, more like 4% with) for the future, for a simple allocation model and a 10-year window.
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2drew3超过 5 年前
Given the bulk of a median American household&#x27;s wealth is tied to the equity of their primary residence, it would be interesting to see how these returns stack an investment in a single family residential home.<p>I imagine it would be difficult to parse out home improvements and so forth, but it would be a comparison that more people to could relate to given the average person doesn&#x27;t buy T-bills and such.
jashkenas超过 5 年前
Here’s a quickie (linear&#x2F;log) line chart of the data in this table:<p><a href="https:&#x2F;&#x2F;observablehq.com&#x2F;@jashkenas&#x2F;annual-returns-on-stocks-treasury-bonds-and-treasury-bills" rel="nofollow">https:&#x2F;&#x2F;observablehq.com&#x2F;@jashkenas&#x2F;annual-returns-on-stocks...</a>
nostromo超过 5 年前
I&#x27;m interested in how they&#x27;re pricing the S&amp;P 500 before it existed.<p>Yes, you could just say, &quot;the biggest 500 public companies in the US&quot; -- but it&#x27;s a little more nuanced than that, so it&#x27;d be interesting to see how it&#x27;s calculated.
jakeinspace超过 5 年前
So a $100 investment in an S&amp;P 500 equivalent (not yet an established index) on January 1st 1928 would be worth $382,850 by January 1st 2019? That&#x27;s over a 250x return after adjusting for inflation, pretty neat.
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Booktrope超过 5 年前
Wait! These figures are not inflation adjusted. Inflation has been about 15X since 1928. So, the $382,000 shown on the chart for 2018 is now worth about $26,000 in 1928 dollars, against $143 value sometime in 1928. That is, in constant dollars, about 180 x over 90 years, not a bad return on investment, but, not what&#x27;s shown on this chart!<p>However, if you start your comparison with 1932 instead, market average value has increased from about $50 into about $26000, or 520 times return over investment over 86 years, a dramatically better result! Illustrating the second most basic rule of investing: buy low.<p>Consider, if you&#x27;d invested in a market fund in 1999 instead, you&#x27;d have turned $156,000 into about $253,000 (inflation adjusted) or a gain of about (uh-oh) much less than 2x over almost 20 years. In other words, ROI of much less than 10% per year. Investments not so good in this century, even with the huge stock market run-up of the past few years!<p>Just for comparison, a plumber in the US seems to have made about $1.25 an hour or so in 1928, compared to about $27 an hour in 1998 (according to BLS). In constant dollars, wages seem to have less than doubled. So, long term, investors did much, much better than workers, that&#x27;s for sure!<p>And since 1997 plumbers have just kept up with inflation, according to BLS (going from $17.50 an hour in 1997 to to $27 an hour in 2019 -- equivalent to $17.50 in 1997 dollars).<p>So, big news. Invested capital has increased much faster than compensation of labor in the US, both long and short term. Well, if you think plumbers are typical.<p>Obviously in the past 20 years, hacker pay has done much better than plumber pay! In fact, hacker pay has increased much more than return on investment! Does this mean, capitalists should fight for lower hacker wages? Or does it mean, we have met the enemy and it is us? Only time will tell...
kyleblarson超过 5 年前
The volatility of equities in the 1928-1942 period is crazy.
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ferros超过 5 年前
Why is the volatility so high only recently on the 10 year note.<p>e.g. historically it only fluctuated low single digits, while stocks have always had large volatility ranges.
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maerF0x0超过 5 年前
I wish they&#x27;d say what &quot;Stocks&quot; means. Is it the entire market? On which exchanges?<p>This is a relevant read: <a href="https:&#x2F;&#x2F;www.investopedia.com&#x2F;terms&#x2F;s&#x2F;survivorshipbias.asp" rel="nofollow">https:&#x2F;&#x2F;www.investopedia.com&#x2F;terms&#x2F;s&#x2F;survivorshipbias.asp</a>
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nullbyte超过 5 年前
Is this adjusted for inflation?
nappy-doo超过 5 年前
FYI, stocks show CAGR of 9.59%.
rolltiide超过 5 年前
The way to play treasuries are in massive highly leveraged carry trades. They&#x27;re not for actually holding, unless you are starting with $100,000,000* in capital.<p>*This amount is tied to how much you want to make a year based on the treasury bond&#x27;s interest rate. This will always be lower than inflation.
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