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Not sure it's safe to assume the stock market will go up and up. Perhaps it will, but where does that money come from?
by 1ba9115454 9y ago
Not sure it's safe to assume the stock market will go up and up. Perhaps it will, but where does that money come from?
- whack 9y agoThe S&P 500 has a PE ratio of ~20. Which means that for every $20 of stocks that you earn, your portfolio of companies are generating $1 in yearly profit. These profits alone represent a ~5% ROI. That's where the money comes from.