The 2000’s Was the Worst Decade For Investors
What are the odds that had you bought the S&P 500 in the 1990’s, it would be higher twelve months later? It was all but guaranteed; any purchase made during this bull market had a 92% likelihood that you would have made money over the course of a year. Perhaps even more astonishing, the average change of +15.77% for the S&P 500 was the highest for any decade we’ve ever had! Think about that for a second, if you were to buy the S&P 500 any day in the 90’s, on average you would have made ~16% just twelve months later, pretty amazing.
In contrast, during the 2000’s, investors suffered through a lost decade. While the 90’s was the best time to be an investor, the 2000’s were the worst. The S&P 500 compounded annually at a loss of 2.7%. If you were to invest on any random day during the lost decade, the average return over the course of twelve months was -1.58%. To give you an idea of how bad this is, the only other period that can make a similar claim was the 1930’s, which returned -0.29% on average from a year earlier. Had you picked any day in the 2000’s, the chances you were higher one year later was just 56%, hardly better than a coin toss.
To put these numbers in context, looking at the data back to 1929, stocks are higher one year later 69% of the time with an average change of +7.58%.
So what might Milennials expect going forward? Let’s take a look at prior generations.
Baby boomers had a fantastic run investing in the 80’s and 90’s only to see their pre-retirement years burned by the lost decade. Their parents were less fortunate, enjoying good returns in the 50’s only to be left with feelings of nostalgia as the 60’s and 70’s can only be described as a period of max pain for investors. Baby Boomers’ Grandparents had an even tougher time; speculative fever ballooned in the 20’s only to be followed by two decades of virtually zero returns.
Notice a pattern here?
Each subsequent generation has been blessed with better and better investing opportunities. Despite having just experienced the worst decade for investors, I am extremely bullish on the opportunities my generation has to grow our wealth in the stock market over the next twenty to thirty years.
Photo by Sander van der Wel
Recommended for You
As the oil price slump continues to put shale drillers under increasing pressure, new and surprising methods of improving oil recovery are being consideredOilprice.com
July manufacturing PMI data shows that Vietnam continues to outshine its southeast Asian neighbors Thailand, Indonesia, Malaysia and Singapore. Vietnam's PMI came in at 52.6 in July, ticking up from 52.2 in June. Meanwhile, its ASEAN neighbors continue to struggle in the contraction region.Barrons.com
MOSCOW (AP) — Russia has submitted a revised bid for vast territories in the Arctic to the United Nations, the Foreign Ministry said Tuesday.Associated Press
It's nearly time for that big oil rally everyone has been waiting for. Here are instructions on how and when to get in.TheStreet.com
A couple just bought a new car, but a sudden furlough made a big impact on their finances. Here's what to do if you can't afford your car payment.Credit.com
School districts spend an average $18,000 per year on teacher development, and teachers devote about 10 percent of their time to professional learning, but a new report finds that such programs may not be producing any measurable results. The report, released today by TNTP, a nonprofit aimed at…The Fiscal Times
General Electric booked $3.3 billion in savings last quarter by widening retiree-benefit cuts from salaried positions to hourly production jobs, prompting a backlash from former employees.TheStreet.com
The "Fast Money" traders give their final trades of the day.CNBC
A sport utility vehicle that bears an uncanny resemblance to the Land Rover Evoque will go on sale in China this week at a third of its sticker price. More than 5,500 people have put down deposits for the Landwind X7, which will be available in dealerships from Thursday at a starting price of…Bloomberg
- Daily DividendsSponsored
This Texas woman has developed an investing strategy unlike any other that allows her to collect a $1,558 in dividends monthly. Learn how she does it.
Aug. 4 -- On a “With All Due Respect” interview, presidential candidate Donald Trump discusses a wide range of topics, including interest rates, the Volcker Rule, former treasury Secretary Robert Rubin and Citizens United. On the lighter side, he tells Mark and John what he likes to do for fun and…Bloomberg Video
The Internet went gaga Monday over what seemed to be the ultimate in wristwear decadence: a new offering called the Skyview Pinnacle from Swiss watchmaker Nico Gerard — so new, in fact, that you have to pay $200 for the privilege of pre-ordering the $9,500 item. What makes the Skyview Pinnacle so…The Fiscal Times
Former Raiders tailback Darren McFadden got his price and then some for his home in Oakland.Los Angeles Times
Of all the thousands of words that have tumbled out of Donald Trump’s mouth since the self-adulating billionaire announced his candidacy for president in June, exactly none of them have cohered into a recognizable policy position on a serious issue. Asked if he would favor shutting down the federal…The Fiscal Times
Bill Fleckenstein, Fleckenstein Capital President, discusses his short ideas and explains why he says the market and the Fed are "trapped."CNBC Videos
It is just not David Einhorn's kind of market. The billionaire hedge fund manager said on a...Business Insider
Thailand’s baht fell toward a six-year low as global funds sold the nation’s assets ahead of a central bank meeting amid speculation U.S. interest rates will be raised as soon as next month. Overseas investors have pulled a net $157 million from Thai stocks and bonds so far this week, data compiled…Bloomberg
Upon installation, Windows 10 defaults to some pretty serious privacy invasions. Here are some steps you can take to keep your personal data private.TechRepublic
Losing a loved one is never easy, and it's only made harder when you're left wondering how to deal with the debt they left behind.Credit.com
Small oil companies are to experience additional financial stress if oil prices stay at depressed levels for the next few years.Investopedia
Energy companies appear to be cutting dividends left and right, but some companies are keeping -- and even increasing -- their payouts.TheStreet.com