Expect Triple Digit Returns Over the Next Decade
According to Merrill Lynch strategist Richard Bernstein, since the 1930s, whenever the return from stocks has been negative over 10 years, equities rose by at least 100% over the following 10. Via ClusterStock
There have been 30 times since the 1930s when the trailing 10-year return on stocks was negative. The compounded average return per year after the negative decade has been 12%, higher than the long-term average of ~10%.
Of course, all these time periods were within a three year time period at the beginning of World War II. However, given that returns are mean-reverting and that equities are cheap, I have little doubt that the next 10 years will be very good for stocks.
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