One persuasive study contends that common stocks will make money for you in most years.
1-year periods
This study, done by the brokerage firm Smith Barney, looked at the 35 one-year periods between 1960 and 1995.
The study computed total return, which adds capital gains and dividends.
Over that span, stocks (as represented by the Standard & Poor's 500 index) performed unsatisfactorily in only 8 of those 35 years.
In other words, you would have been better off in money-market funds during those 8 years.
Common stocks would ahve been more successful in 27 of those 35 years.
(Comment: You can expect to have 1 down year for every 5 years of your investing.)
Read also:
Why Invest in Stocks?
Why Invest in Stocks? Look at the Facts
Why Invest in Stocks? Investing for the Long Term
Why Invest in Stocks? Some Profitable Comparisons
Why Invest in Stocks? Why Doesn't Everyone Buy Common Stocks?
Why Invest in Stocks? An Example in Practice
Keep INVESTING Simple and Safe (KISS) ****Investment Philosophy, Strategy and various Valuation Methods**** The same forces that bring risk into investing in the stock market also make possible the large gains many investors enjoy. It’s true that the fluctuations in the market make for losses as well as gains but if you have a proven strategy and stick with it over the long term you will be a winner!****Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.
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