Thinking About Thinking

U.S. Stock Performance Over 50 Years

Posted in Economy by larrycheng on January 1, 2010

How well have US stocks performed? 

With another decade in the books, here’s the quick compounded annual return of the S&P 500 for 50 years:

  • Last 10 years: -2.9%
  • Last 20 years: 6.1%
  • Last 30 years: 8.3%
  • Last 40 years: 6.5%
  • Last 50 years: 6.2%

Here’s the compounded annual return of the Dow Jones Industrial Average for 50 years:

  • Last 10 years: -0.5%
  • Last 20 years: 7.0%
  • Last 30 years: 9.0%
  • Last 40 years: 6.7%
  • Last 50 years: 5.8%

And finally, the compounded annual return of the Nasdaq Composite over 30 years:

  • Last 10 years: -5.7%
  • Last 20 years: 8.4%
  • Last 30 years: 9.5%

People used to say that stocks generate about 8%+ annual returns over the long-run.  It seems fairer now to say that stocks generate 6%+ annualized returns over the long-run.  That type of return doesn’t blow my mind given inflation and capital gains tax though it’s still better than a lot of things.  I also have to think that the next 10 years will be better than the last 10 years. 

4 Responses

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  1. Stock Trading System said, on February 16, 2010 at 8:29 am

    Hi, I found your blog through MSN search and read a few

  2. An Open letter to Tim Griffin | KB5GQO said, on September 9, 2011 at 9:16 am

    […] My numbers are based on the 50 year DOW return of 5.8%, of course the S&P did better.  http://larrycheng.com/2010/01/01/u-s-stock-performance-over-50-years/ […]

  3. emini gold said, on October 8, 2013 at 9:44 pm

    My spouse and I absolutely love your blog and find most of
    your post’s to be exactly what I’m looking for. Do you offer guest
    writers to write content available for you? I wouldn’t mind
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  4. Tom Jones said, on April 16, 2014 at 2:49 pm

    have you updated this 50-year chart through 2013? If so, where can I find it?


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