
- September30 2004
- Volume 11
- Issue 18
Gloomy Number Forecast
Tip:
Back when stocks were yielding20% a year, market bears noted that thehistoric return on stocks was around8% to 10% a year. Now that the stockmarket has fallen into a stupor, optimistspoint to the same historic returns.But even at 10% a year, you'll realizethe stock market hasn't been a terrificinvestment once you start crunching thenumbers to account for inflation andexpenses. Take, for instance, the 10.4%average annual return from 1926through 2003. Back out the inflationrate, taxes, and brokerage commissions,and then adjust for some badstock picks. The resulting final averageannual yield gets pared down to a scant2.4%. You can't do much aboutinflation and taxes, but you can paredown expenses and avoid picking individualstocks that turn turkey byputting your money into a low-costindex mutual fund.
Articles in this issue
about 18 years ago
Discover the Value of Staying Involvedabout 18 years ago
Has Diversification Been Resurrected?about 18 years ago
Retire the Jersey of Your Aging Stocksabout 18 years ago
Climb the Ladder of Bond Investingabout 18 years ago
Consider Your Options in Foreign Stocksabout 18 years ago
Shrink Away from Your Big Mutual Fundsabout 18 years ago
Click on the Best Online Stockbrokerabout 18 years ago
Doc's Stocks Contest #12 Current Standingsabout 18 years ago
Close-Up: Business Entitiesabout 18 years ago
Grasp the Super IRA's Asset ProtectionRelated to this article








