/biz/ - Business & Finance

[Anonymous No.11201502]

What's a realistic, average annual return to expect on an investment portfolio?

Most sources tell me 6%. Is that accurate?

[Anonymous No.11201518]

>>11201502

Yes, it factors in downturns. Too many people get cocky in bull markets and think 30% YoY gains are the norm.

[Anonymous No.11201522]

it depends

is your portfolio 100% DOGE?

[Anonymous No.11201963]

>>11201502
Depends on your asset allocation. I'd say it's reasonable to expect 5-6% at this point (pre-tax), were late cycle for sure. Look at Warren Buffett's portfolio and see that it's mostly defensive stocks and cash, the one exception is his large stake in Apple, but that was just a classic bargain, he started buying around 11 Forward P/E and 7X EBITDA.

[Anonymous No.11201985]

>>11201502
6 or 7%, which, taking into account inflation (which is actuslly greater than the 3% figure the government gives us) turns into 3 or 4% of actual real gains. Remember that a million tidy will only be the equivalent of a few hundred thousand in 30 years. You have to save a lot more to make it than you think

[Anonymous No.11202008]

>>11201502
>>11201502
Depends on your beta. For a portfolio with a beta of 1 you should expect 5-8% real return (i.e. what’s left after accounting for inflation).

[Anonymous No.11202040]

>>11202008
Problem with that CAPM logic is that lower beta stocks have better longer term returns, because high beta stocks tend to crash and burn.

[Anonymous No.11202053]

>>11201502
800%

[Anonymous No.11202054]

>>11201502
My dad had 35% profit last year on his boomer stocks. He had 15% year before that and now he's 20% down.

[Anonymous No.11202055]

>>11201502 (OP) #
Depends on the bets of your portfolio. For a portfolio with a beta of 1 you should expect 5-7% real return (i.e. what’s left after accounting for inflation) on average in the very long run. However, it’s important to realize that the actual average return could be a lot lower/higher (e.g. 2% or 15%) over the next 20-100 years if the average productivity growth turns out to be a lot lower/higher than expected (it easily could).

[Anonymous No.11202082]

>>11201502 (OP) #
Depends on the beta of your portfolio. For a portfolio with a beta of 1 you should expect 5-7% real return (i.e. what’s left after accounting for inflation) in the very long run. However, it’s important to realize that the average real return could be a lot lower/higher (e.g. 2% or 11%) over the next 20-100 years if the average productivity growth turns out to be lower/higher than expected.

>>11202040
High beta stocks historically have lower risk adjusted returns but they don’t have lower returns.

[Anonymous No.11202098]

You can expect 10x nominal growth every 30 years or 8% a year.

[Anonymous No.11202114]

>>11201502
Central banks have permanently eliminated the business cycle, this is a good thing, now we will have 2.5-4.5% GDP growth for the next 1000 years uninterrupted. Credit will flow easily, real estate and stock prices will increase forever until the singularity. By 2025 the MEDIAN house will cost $1.5 million and there will be 40 year mortgages available, by 2035 a median house will cost 4 million and there will be 55 year mortgages, easy access to credit means everybody can afford a house. By 2025 the Dow Jones will be at 70,000 too, and the VIX index will fall to 4-7 and never go above 15 again. People who own assets will become increasingly wealthy until they diverge from the rest of humanity and merge with AI, poorfags(workers) will have falling wages adjusted for inflation, but access to credit will make up for it and unemployment will be 2.5% so they have plenty of choice too.

Anyways, US equities will probably be returning 15% annually for the next 30 years at least, tech stocks in particular will probably have 25% annual growth in the next decade

[Anonymous No.11202116]

>>11201502 (OP) #
Depends on the beta of your portfolio. For a portfolio with a beta of 1 you should expect 5-7% real return (i.e. what’s left after accounting for inflation) in the very long run. However, it’s important to realize that the average real return could be a lot lower/higher (e.g. 2% or 11%) over the next 20-100 years if, for example, productivity growth turns out to be lower/higher than expected.

>>11202040 #
High beta stocks historically have lower risk adjusted returns but they don’t have lower returns.

[Anonymous No.11202221]

>>11202114
I love you