Where should you invest your hard earned money? Using history as a guide, the answer overwhelmingly is in stocks.
During the past 204 years (through 2005) stock investors have earned an average 6.8 percent per year after inflation and that return has been remarkably stable over long periods. Over the past 80 years, real stock returns averaged 6.7 percent per year, and since the end of the Second World War, the annual return has been 6.8 percent. This return includes both capital gains and dividend income and is measured after the effects of inflation have been subtracted. These numbers mean that on average, investors' wealth has doubled in purchasing power every decade in stocks, a feat rivaled by no other asset class.
Neither I nor any other economists have uncovered precisely why investors have received this return and cannot promise they will receive it in the future. But history clearly suggests that stocks will continue to be the best long-term assets for investors.
http://finance.yahoo.com/columnist/article/futureinvest/2881
During the past 204 years (through 2005) stock investors have earned an average 6.8 percent per year after inflation and that return has been remarkably stable over long periods. Over the past 80 years, real stock returns averaged 6.7 percent per year, and since the end of the Second World War, the annual return has been 6.8 percent. This return includes both capital gains and dividend income and is measured after the effects of inflation have been subtracted. These numbers mean that on average, investors' wealth has doubled in purchasing power every decade in stocks, a feat rivaled by no other asset class.
Neither I nor any other economists have uncovered precisely why investors have received this return and cannot promise they will receive it in the future. But history clearly suggests that stocks will continue to be the best long-term assets for investors.
http://finance.yahoo.com/columnist/article/futureinvest/2881
