2 ms·

8% return in equities market? Wow... I did not know what I can just invest money in the stock market and get rich... The 8% annual return is impossible to achi

by tlogan 10y ago

8% return in equities market? Wow... I did not know what I can just invest money in the stock market and get rich... The 8% annual return is impossible to achieve (BTW, that is number what sharks tell to "retail investors"). Between 1998 to 2008 the annualized return on SP 500 was about -1.35% (yes negative and there was huge boom during 2000s). And that is excluding all fees. I think 8% would be an excellent return for limited partners who invest into VC funds...

icedchai 10y ago
It's possible to achieve if you invest for the long term and stay the course. Between 1992 and today you would've gotten over 9% annual return with just the Vanguard Total Stock Market Index fund.
JoshuaDavid 10y ago
Yes, but that's because you cherry-picked the decade with the lowest return. Over the past 50 years, the average return on investment for 10 year periods has been [1] 1956 - 1966 9.21% 1957 - 1967 12.81% 1958 - 1968 9.91% 1959 - 1969 7.74% 1960 - 1970 8.08% 1961 - 1971 6.97% 1962 - 1972 9.83% 1963 - 1973 5.97% 1964 - 1974 1.29% 1965 - 1975 3.31% 1966 - 1976 6.66% 1967 - 1977 3.65% 1968 - 1978 3.24% 1969 - 1979 5.92% 1970 - 1980 8.50% 1971 - 1981 6.55% 1972 - 1982 6.70% 1973 - 1983 10.56% 1974 - 1984 14.61% 1975 - 1985 14.12% 1976 - 1986 13.62% 1977 - 1987 15.09% 1978 - 1988 16.13% 1979 - 1989 17.34% 1980 - 1990 13.80% 1981 - 1991 17.41% 1982 - 1992 16.08% 1983 - 1993 14.85% 1984 - 1994 14.32% 1985 - 1995 14.83% 1986 - 1996 15.23% 1987 - 1997 17.90% 1988 - 1998 19.04% 1989 - 1999 18.05% 1990 - 2000 17.30% 1991 - 2001 12.81% 1992 - 2002 9.26% 1993 - 2003 10.96% 1994 - 2004 11.95% 1995 - 2005 8.98% 1996 - 2006 8.33% 1997 - 2007 5.84% 1998 - 2008 -1.36% 1999 - 2009 -0.95% 2000 - 2010 1.38% 2001 - 2011 2.88% 2002 - 2012 7.03% 2003 - 2013 7.34% 2004 - 2014 7.61% 2005 - 2015 7.25% So yes, you historically could just invest money in the stock market and get rich, and you will probably continue to be able to do so. [1] http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/...
- MagnumOpus 10y ago
  That was back when both inflation and interest rates were higher. Not necessarily comparable. (Why do you think that many experts pick 10 year maturity bonds with a 1.5% coupon over stocks?)

by tlogan 10y ago

icedchai 10y ago

It's possible to achieve if you invest for the long term and stay the course. Between 1992 and today you would've gotten over 9% annual return with just the Vanguard Total Stock Market Index fund.

JoshuaDavid 10y ago

Yes, but that's because you cherry-picked the decade with the lowest return. Over the past 50 years, the average return on investment for 10 year periods has been [1] 1956 - 1966 9.21% 1957 - 1967 12.81% 1958 - 1968 9.91% 1959 - 1969 7.74% 1960 - 1970 8.08% 1961 - 1971 6.97% 1962 - 1972 9.83% 1963 - 1973 5.97% 1964 - 1974 1.29% 1965 - 1975 3.31% 1966 - 1976 6.66% 1967 - 1977 3.65% 1968 - 1978 3.24% 1969 - 1979 5.92% 1970 - 1980 8.50% 1971 - 1981 6.55% 1972 - 1982 6.70% 1973 - 1983 10.56% 1974 - 1984 14.61% 1975 - 1985 14.12% 1976 - 1986 13.62% 1977 - 1987 15.09% 1978 - 1988 16.13% 1979 - 1989 17.34% 1980 - 1990 13.80% 1981 - 1991 17.41% 1982 - 1992 16.08% 1983 - 1993 14.85% 1984 - 1994 14.32% 1985 - 1995 14.83% 1986 - 1996 15.23% 1987 - 1997 17.90% 1988 - 1998 19.04% 1989 - 1999 18.05% 1990 - 2000 17.30% 1991 - 2001 12.81% 1992 - 2002 9.26% 1993 - 2003 10.96% 1994 - 2004 11.95% 1995 - 2005 8.98% 1996 - 2006 8.33% 1997 - 2007 5.84% 1998 - 2008 -1.36% 1999 - 2009 -0.95% 2000 - 2010 1.38% 2001 - 2011 2.88% 2002 - 2012 7.03% 2003 - 2013 7.34% 2004 - 2014 7.61% 2005 - 2015 7.25% So yes, you historically could just invest money in the stock market and get rich, and you will probably continue to be able to do so. [1] http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/...

MagnumOpus 10y ago
That was back when both inflation and interest rates were higher. Not necessarily comparable. (Why do you think that many experts pick 10 year maturity bonds with a 1.5% coupon over stocks?)