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Figure 2-4 |
|
| Rolling 10-Year Data (%) |
|
1935-2009 |
|
| --------------------------------------------------------- |
| Period |
Bonds |
Stocks |
| --------------------------------------------------------- |
| 1926-1935 |
5.0 |
5.9 |
| 1927-1936 |
4.9 |
7.8 |
| 1928-1937 |
4.1 |
0.0 |
| 1929-1938 |
4.6 |
-0.9 |
| 1930-1939 |
4.9 |
-0.1 |
| 1931-1940 |
5.0 |
1.8 |
| 1932-1941 |
5.7 |
6.4 |
| 1033-1942 |
4.4 |
9.3 |
| 1934-1943 |
4.6 |
7.2 |
| 1935-1944 |
3.9 |
9.3 |
| 1936-1945 |
4.5 |
8.4 |
| 1937-1946 |
3.7 |
4.4 |
| 1938-1947 |
3.4 |
9.6 |
| 1939-1948 |
3.2 |
7.3 |
| 1940-1949 |
3.2 |
9.2 |
| 1941-1950 |
2.6 |
13.4 |
| 1942-1951 |
2.1 |
17.3 |
| 1943-1952 |
1.9 |
17.1 |
| 1944-1953 |
2.1 |
14.3 |
| 1945-1954 |
2.5 |
17.1 |
| 1946-1955 |
1.3 |
16.7 |
| 1947-1956 |
0.8 |
18.4 |
| 1948-1957 |
1.8 |
16.4 |
| 1949-1958 |
0.8 |
20.1 |
| 1950-1959 |
-0.1 |
19.4 |
| 1951-1960 |
1.2 |
16.2 |
| 1952-1961 |
1.7 |
16.4 |
| 1953-1962 |
2.3 |
13.4 |
| 1954-1963 |
2.0 |
15.9 |
| 1955-1964 |
1.7 |
12.8 |
| 1956-1965 |
1.9 |
11.1 |
| 1957-1966 |
2.9 |
9.2 |
| 1958-1967 |
1.1 |
12.8 |
| 1959-1968 |
1.7 |
10.0 |
| 1960-1969 |
1.4 |
7.8 |
| 1961-1970 |
1.3 |
8.2 |
| 1962-1971 |
2.5 |
7.1 |
| 1963-1972 |
2.4 |
9.9 |
| 1964-1973 |
2.1 |
6.0 |
| 1965-1974 |
2.2 |
1.2 |
| 1966-1975 |
3.0 |
3.3 |
| 1967-1976 |
4.3 |
6.6 |
| 1968-1977 |
5.2 |
3.6 |
| 1969-1978 |
5.1 |
3.2 |
| 1970-1979 |
5.5 |
5.9 |
| 1971-1980 |
3.9 |
8.4 |
| 1972-1981 |
2.8 |
6.5 |
| 1973-1982 |
5.8 |
6.7 |
| 1974-1983 |
5.9 |
10.6 |
| 1975-1984 |
7.0 |
14.8 |
| 1976-1985 |
9.0 |
14.3 |
| 1977-1986 |
9.7 |
13.8 |
| 1978-1987 |
9.5 |
15.3 |
| 1979-1988 |
10.6 |
16.3 |
| 1980-1989 |
12.6 |
17.5 |
| 1981-1990 |
13.7 |
13.9 |
| 1982-1991 |
15.6 |
17.6 |
| 1983-1992 |
12.6 |
16.2 |
| 1984-1993 |
14.4 |
14.9 |
| 1985-1994 |
11.9 |
14.4 |
| 1986-1995 |
11.9 |
14.8 |
| 1987-1996 |
9.4 |
15.3 |
| 1988-1997 |
11.3 |
18.0 |
| 1989-1998 |
11.7 |
19.2 |
| 1990-1999 |
8.8 |
18.2 |
| 1991-2000 |
10.3 |
17.5 |
| 1992-2001 |
8.7 |
12.9 |
| 1993-2002 |
9.7 |
9.3 |
| 1994-2003 |
8.0 |
11.1 |
| 1995-2004 |
9.8 |
12.1 |
| 1996-2005 |
7.6 |
9.1 |
| 1997-2006 |
7.8 |
8.4 |
| 1998 -2007 |
7.3 |
5.9 |
| 1999-2008 |
8.4 |
-1.4 |
| 2000-2009 |
6.2 |
-1.0 |
Because of the significant decline in the stock market during 2007-2008, performance for the stock market for the period of 1999-2008 is now the second worst for any ten-year period since the data began.
Furthermore, bonds have outperformed stocks during this decade by the second greatest margin for any ten-year period in history (only the decade ended in 2008 was worse). Even cash investments outperformed stocks during this period, which is an unusual event.
However, given the volatility of returns for stocks, this is not surprising, and it is likely to happen, but very infrequently, as suggested by the distribution of returns for ten-year periods shown in Figure 2.5 below.
This development in no way detracts from the importance of investing in equities over the long term, and the recent performance may suggest that future results will be considerably better.
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