The Bumpy Road to the Market’s Long-Term Average
It’s important to remember that returns in any given year may be sky-high, extremely poor, or somewhere in between.
Since 1926, the US stock market has rewarded investors with an average annual return of about 10%. But it’s important to remember that returns in any given year may be sky-high, extremely poor, or somewhere in between.
Annual returns came within two percentage points of the market’s long-term average of 10% in just six of the past 94 years.
Yearly returns have ranged as high as up 54% and as low as down 43%.
Since 1926, annual returns have been positive 69 times and negative 25 times.
Understanding the range of potential outcomes can help you stick with a plan and ride out the inevitable ups and downs.
Past performance, including hypothetical performance, is not a guarantee of future results.