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11-26-2018, 03:29 PM
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#1
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Full time employment: Posting here.
Join Date: Dec 2013
Posts: 599
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EZ money on Wall St
The S&P 500 as returned 13% per year since March 2009. Many said expect mid single digit returns. Does anyone feel entitled to more above historical trend returns going forward? What has caused above average returns since 2009 & do you feel comfortable factoring in double digit returns for the next 10 years?
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11-26-2018, 03:32 PM
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#2
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Jan 2018
Location: Tampa
Posts: 10,265
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I would be very happy with 7% nominal for the next 10 years.
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TGIM
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11-26-2018, 03:35 PM
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#3
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 33,640
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+1
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If something cannot endure laughter.... it cannot endure.
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Retired Jan 2012 at age 56
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11-26-2018, 03:38 PM
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#4
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Full time employment: Posting here.
Join Date: Sep 2007
Location: Portland
Posts: 580
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+1 - yeah 7%
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11-26-2018, 03:41 PM
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#5
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Feb 2011
Location: NC Triangle
Posts: 5,671
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My retirement fund spreadsheet assumes 6% annual return (nominal).
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11-26-2018, 03:56 PM
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#6
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Thinks s/he gets paid by the post
Join Date: Jan 2015
Posts: 1,245
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Same here, nominal 6%. Actually I have 5 time periods defined and can adjust expectations based on age since I plan on changing AA (and expenses) over the years.
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Wisdom starts with wonder
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11-26-2018, 03:59 PM
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#7
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Syracuse
Posts: 3,386
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Yes. Entitled to it!
Seriously, I'll be ecstatic if we get 3% real over the next 10 years if its nice and smooth.
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“No, not rich. I am a poor man with money, which is not the same thing"
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11-26-2018, 04:11 PM
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#8
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Feb 2011
Location: NC Triangle
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 Quote:
Originally Posted by KCGeezer
Same here, nominal 6%.
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May be a “Midwestern thaing”.
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11-26-2018, 04:17 PM
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#9
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Sep 2005
Location: Northern IL
Posts: 25,820
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Quote:
Originally Posted by Free bird
The S&P 500 as returned 13% per year since March 2009. Many said expect mid single digit returns. ...
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Goes to show that many people have no idea.
Quote:
Originally Posted by Free bird
... Does anyone feel entitled to more above historical trend returns going forward? ...
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Makes no difference if you feel entitled or not. Market doesn't care. Market will do what market will do. I don't feel entitled to anything.
Quote:
Originally Posted by Free bird
... What has caused above average returns since 2009 & do you feel comfortable factoring in double digit returns for the next 10 years?
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I'd bet you couldn't get much consensus on the cause for the past, let alone the future.
I don't feel comfortable or uncomfortable, because I don't factor in anything. Market might be negative over the next 10 years, it's happened before. Better be ready for that.
-ERD50
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11-26-2018, 04:22 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Syracuse
Posts: 3,386
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Quote:
Originally Posted by Free bird
What has caused above average returns since 2009 & do you feel comfortable factoring in double digit returns for the next 10 years?
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My opinion, and it is just an opinion, is the above average returns came about from the below average returns the ten years previous.
A reversion to mean.
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11-26-2018, 04:37 PM
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#11
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Full time employment: Posting here.
Join Date: Dec 2013
Posts: 599
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From Oct 1989 to Oct 1999 return was almost 11%. So you might be right. Could be a skinny 10 year run coming up.
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11-26-2018, 05:13 PM
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#12
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Give me a museum and I'll fill it. (Picasso)
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Quote:
Originally Posted by steelyman
My retirement fund spreadsheet assumes 6% annual return (nominal).
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Yes, mine too.
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FIREd date: June 26, 2018 - "This Happy Feeling, Going Round and Round!" (GQ)
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11-26-2018, 05:34 PM
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#13
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Jan 2006
Location: Rio Grande Valley
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The amazing average returns since March 2009 are mostly because the market indexes had been more than cut in half between Oct 2007 and Mar 2009.
You get vastly different statistics depending on where you start measuring.
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Retired since summer 1999.
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11-26-2018, 06:18 PM
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#14
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Give me a museum and I'll fill it. (Picasso)
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I will be happy to just outpace inflation.
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11-26-2018, 06:37 PM
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#15
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Full time employment: Posting here.
Join Date: Dec 2013
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In the last 39 years the S&P 500 has payed 5.5%. Just doesn't seem like all that good considering the volitility one must endure.
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11-26-2018, 06:39 PM
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#16
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Full time employment: Posting here.
Join Date: Dec 2013
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So were really out of plumb the last 10 years. I'd say reversion to the mean would be just around the corner if I was a betting man. But I'm not a betting man. I'm a freebird.
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11-26-2018, 07:09 PM
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#17
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Give me a museum and I'll fill it. (Picasso)
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Join Date: Sep 2005
Location: Northern IL
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Quote:
Originally Posted by Free bird
In the last 39 years the S&P 500 has payed 5.5%. Just doesn't seem like all that good considering the volitility one must endure.
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Source?
CAGR of the Stock Market: Annualized Returns of the S&P 500
That link says about 12% from Jan 1979 to Dec 2017.
Did you include divs? Even w/o divs, that source says 8.9%.
$1.00 grew to: $83.20
That checks out in a calculator: 1.12^39 ≈ 83.081224 (some very slight rounding on the 12%).
-ERD50
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11-26-2018, 07:16 PM
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#18
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Full time employment: Posting here.
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Your right that 5.5% did not include dividends.
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11-26-2018, 07:19 PM
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#19
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Full time employment: Posting here.
Join Date: Dec 2013
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8.3% inflation adjusted.
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11-26-2018, 07:20 PM
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#20
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Full time employment: Posting here.
Join Date: Dec 2013
Posts: 599
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From October 1979 to October 4th 2018. How do you get 12%?
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