How to read this chart:
Pick a starting year, then go down the number of years and the corresponding square will tell you the annualized return from that starting point.
For example, the 9-year annual return starting in 1993 was about 14% per year.
You can see there’s been more green than red since 1993, but there were some painful periods for investors as well.
Here’s a sampling of some events over the past 31 years: An emerging markets currency crisis in 1998, the Long-Term Capital Management blow-up, the Dot Com Bubble, 9/11, the housing bubble, the Great Financial Crisis, the European Debt Crisis, the Pandemice and the highest inflationary spike in four decades.
We also sprinkled in a few recessions, two massive market crashes, two bear markets and ten double-digit corrections.
And the stock market still returned approximately 10% per year.
We don’t know what the returns will look like over the next three decades, but we are confident that there will be plenty of risk, downturns, geopolitical crises, scary headlines and economic contractions.
Regardless of what returns the stock market produces in the future, thinking and acting for the long-term remains the most proven strategy for investors.
Thank you to Ben Carlson for the graphic below. You can read more at: https://lnkd.in/gzRqkgqr
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