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Rates
of Return
Brian
Trumbore
President/Editor, StocksandNews.com
The new 2004 Ibbotson Associates Yearbook
is out and since I paid good money for it, and since
all financial planners and brokers use it (at least
their marketing departments do?I know from experience),
it's time to throw out the historical facts.
Compound
Annual Rates of Return by Decade
| |
30s |
40s |
50s |
60s |
70s |
80s |
90s |
00s
|
| Large
Cap Stocks |
-0.1 |
9.2 |
19.4 |
7.8 |
5.9 |
17.5 |
18.2 |
-5.3
|
| Small
Cap Stocks |
1.4 |
20.7 |
16.9 |
15.5 |
11.5 |
15.8 |
15.1 |
13.3 |
| Long-Term
Govt |
4.9 |
3.2 |
-0.1 |
1.4 |
5.5 |
12.6 |
8.8 |
10.8
|
| Inter.-Term
Govt |
4.6 |
1.8 |
1.3 |
3.5 |
7.0 |
11.9 |
7.2 |
8.8
|
| Treasury
Bills |
0.6 |
0.4 |
1.9 |
3.9 |
6.3 |
8.9 |
4.9 |
3.1
|
| Inflation |
-2.0 |
5.4 |
2.2 |
2.5 |
7.4 |
5.1 |
2.9 |
2.3
|
Notes:
00s?2000-2003
Large Cap - S&P 500
Small Cap - 5th capitalization quintile of stocks
on NYSE, 1926-
81, various Dimensional Fund Advisors indices since
1982.
Long-term govt. - 20-year Treasury
Inter.-term govt. - 5-year Treasury
Treasury bill - 30 days
Inflation - CPI
1926-2003
Average Annual Return (geometric mean)
| Large
Cap Stocks |
10.4
|
| Small
Cap Stocks |
12.7
|
| Long-Term
Govt |
5.4
|
| Inter.-Term
Govt |
5.4
(yes, same) |
| U.S.
Treasury Bills |
3.7
|
| Inflation |
3.0
|
And
just for the heck of it, I thought I'd take a look
at how the S&P 500 has performed in the summer months
during an election year; another attempt to beat the
punch.
|
June |
July |
August
|
| 2000 |
+2.5 |
-1.6 |
+6.2
|
| 1996 |
+0.4 |
-4.5 |
+2.1 |
| 1992 |
-1.5 |
+4.0 |
-2.0 |
| 1988 |
+4.6 |
-0.4 |
-3.3 |
| 1984 |
+2.2 |
-1.4 |
+11.3 |
| 1980 |
+3.0 |
+6.8 |
+1.3 |
| 1976 |
+4.3 |
-0.7 |
+0.1 |
| 1972 |
-2.1 |
+0.4 |
+3.9 |
| 1968 |
+1.1 |
-1.7 |
+1.6 |
| 1964 |
+1.8 |
+2.0 |
-1.2 |
| 1960 |
+2.1 |
-2.3 |
+3.2 |
Source:
Ibbotson Associates Inc., 2004 Yearbook
Brian
Trumbore
The
securities markets are subject to the risks of fluctuating
prices and the uncertainty of rates of return and
yields inherent in investing and past performance
is no guarantee of future results.
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