During the 20th Century, the Dow advanced from 66 to 11,497. This gain, though it appears huge, shrinks to 5.3 per cent when compounded annually. For investors to merely match that 5.3 per cent market value gain, the Dow – recently below 13,000 – would need to close at about 2,000,000 on December 31, 2099! Thus, if your adviser talks to you about double digit returns from equities, explain this math to him.
- Warren Buffett
No comments:
Post a Comment