CHART: Long Periods Of Crappy Stock Market Returns Are Not Unusual

Historically, stocks have returned around 9.4 per cent per year, or 6.2 per cent on an inflation-adjusted basis.

However, stocks have returned next to nothing in the last decade.  So, is the miracle of stocks over?

Not necessarily.

“To blindly assume a 9% return for the indefinite future is a stretch, in our opinion,” writes Myles Zyblock. “And, what is “the long term” anyway?

According to Zyblock, Chief Instittutional Strategist for RBC Capital Markets, long-periods of low or negative returns are not too unusual.

From his latest note to clients:

Changes in global economics, politics, technology, and culture suggest this static assumption is probably too restrictive.

We have seen four distinct 10-year periods since 1900 when equity returns were negative in real terms. Additionally, there have been four instances of 20-year periods with roughly 0% real returns.

Here’s a look at the historical chart.

rbc stock market returns

Photo: RBC Capital Markets

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