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The Average is Rare

Crews Bank & Trust Wealth Management Services Jan 24, 2023
chart shows that the average return is 7.5%; however, the number of years the return came in between 5-10% was only 11 out of 123 years

Contents

Today’s Chart of the Day from Jeroen Blokland, @jsblockland on Twitter, shows the distribution of one year of returns from the Dow Jones Industrial Average going back to 1900.

The average return is 7.5%; however, the number of years the return came in between 5-10% was only 11 out of 123 years. This is less than 9% of the time and shows getting the average return in a calendar year is quite rare.

What does this tell us? It says that even though we may expect a certain return, we often don’t overtly see it, just subtlety realize it over a span of years. Therefore, in the short-term, there is no need to get too happy when a year has a higher-than-average return or too angry when it is less.
Chart of the Day

About the Author

Crews Bank & Trust Wealth Management Services
Crews Bank & Trust Wealth Management Services

Experienced professionals from our wealth management services team can help you achieve a bright financial future through investment strategies tailored to you. We’ll show you all of the options available and help you choose the ones best suited to you. We’ll provide high-quality, personal service as we work toward your goals together. Our Portfolio Managers do not receive commissions on trades; our recommendations of investments are based solely on your best interests.

Investments are not a deposit or other obligation of, or guaranteed by, the bank, are not FDIC insured, not insured by any federal government agency, and are subject to investment risks, including possible loss of principal.

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