A Decade of Happy Returns?

One of the most important things that I have learned over the years is that statistics don’t lie. They are what they are, and tell us much.

As the decade concludes, the chart presents the price performance of the US stock market (Dow Jones Industrial average) for each decade since 1900. So how do the 10 years just passed rank? As today's chart illustrates, the performance of the Dow from the close of 1999 through 2009 was the second worst performance on record. Only the Great Depression decade of the 1930s was worse. The current decade also shares an unfortunate outcome with the 1930s in being a decade during which the Dow actually ended lower than where it started

Some statistical points of interest: (this spans 110 years of data)

• the average decade produced an average of 91.63% (simple return)
• the average annual return was 9.16% (simple return)
• the current decade was the second worst performance on record
• the twenty-year bull market of the 1980’s and 1990’s presented gains of 546% or an astounding average annual return of 27.3% (simple return)

So what does the next decade have in store? Have a read of my upcoming blog where I survey over two dozen of the brightest managers around the globe for their forecast.

Have a Happy New Year and a happy new decade.

Chart courtesy of The Chart of the Day.



Saverio Manzo