Comments on: What Is the Average Stock Market Return?

By: Bob Gerdner

Bob Gerdner — Tue, 09 Jul 2019 22:26:47 +0000

I agree, very misleading. I can’t believe that that 7% number we see everywhere is adjusted (based on a guess) for inflation. I would much prefer to know how much actual money I can expect to have in X years. Then I can figure taxes and inflation on my own. The good news is, I’ve never been brave enough to imagine earning 11%!

By: Brad Anderson

Brad Anderson — Tue, 01 Aug 2017 15:13:39 +0000

In reply to Jeff Rose. I agree with Bob on this one. The fact that the 7% includes inflation is the difference between 7-11%.

By: Jeff Rose

Jeff Rose — Sun, 16 Jul 2017 01:54:06 +0000

In reply to Bob. There was no intention to mislead Bob. When ever you're dealing with statistics, you'll get different numbers. This is especially true when the source requires different inputs. That return would be lower for 2009 due to the crash as you said, but that doesn't mean they were inaccurate. And 7% is still a strong return compared to most other investments.

By: Bob

Bob — Thu, 13 Jul 2017 21:18:31 +0000

The direct link you gave to show ” the data seems to prove this ” shows “1950-2009”, “Total Return” to be 11.0%, not 7%. 7% may about be the inflation adjusted number, but you later say ” If you input a different timeframe, index, or add other factors to the equation such as inflation, “, implying that your initial analysis did not account for inflation. 11% vs. 7% has a tremendous impact in future financial modeling.

Not to mention those numbers were through 2009 and this article was written in 2016, including one of the sharpest downturns in history but leaving out the recovery that actually occurred.

Quite misleading