If Inflation averages 3% in the next 20 years, conservative S&P500 growth is ...???

[cyber888]

If Inflation averages 3% in the next 20 years, conservative S&P500 growth is ...

So, if you project inflation to average 3.0% in the next 20 years ...
what would be the average S&P 500 growth is in the same period?

4%, 4.5%, 5%, 6%, 7% ..

What do you feel comfy with

 

[SAtoUS]

Mmmm, not sure, I will say around 8%.

Take a look at this, good info:

Annual Returns Of The S&P 500 From 1928 To 2015

 

[Running_Man]

So, if you project inflation to average 3.0% in the next 20 years ...
what would be the average S&P 500 growth is in the same period?

4%, 4.5%, 5%, 6%, 7% ..

What do you feel comfy with

One-Two percent after inflation so 4-5 percent total

 

[corn18]

I'm using 4% nominal. No particular reason other than it makes me feel comfy.

 

[Dash man]

Projections are a guess. I just hope and pray it goes up more than down.

 

[Totoro]

Historically it was about 3% earnings growth in real terms, incidentally what world GDP growth was. One might want to revise that downwards a notch, population growth is slowing down.

Make it 2% growth + 3% inflation + 2% buyback & reinvested dividends = 7% nominal total return.

Adjust for eventual P/E changes and viola, crystal ball says. Bonds are easier: TIPS + Inflation is a decent proxy. 3.5% or so nominal.

 

[cyber888]

Thanks. Logical !

Historically it was about 3% earnings growth in real terms, incidentally what world GDP growth was. One might want to revise that downwards a notch, population growth is slowing down.

Make it 2% growth + 3% inflation + 2% buyback & reinvested dividends = 7% nominal total return.

Adjust for eventual P/E changes and viola, crystal ball says. Bonds are easier: TIPS + Inflation is a decent proxy. 3.5% or so nominal.