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- As Table 1 shows, all equity markets except Italy, Portugal and Spain
earned a Real Equity rate of more than 6%.
Table 1
Average Annual Real Returns for Stock and Bond Markets of EU Member States
and the United States, 1988-2000 (percent per annum)
| |
Average Annual Real Stock Return |
Interval |
Average Annual Real Government Bond Return |
Interval |
| Austria |
9.36 |
1970-2000 |
2.59 |
1993-2000 |
| Belgium |
11.69 |
1973-2000 |
4.79 |
1992-2000 |
| Denmark
|
10.68 |
1970-2000 |
6.07 |
1990-2000 |
| Finland
|
32.66 |
1988-1999 |
-2.73 |
1996-2000 |
| France
|
11.36 |
1973-2000 |
8.27 |
1986-2000 |
| Germany
|
11.70 |
1970-2000 |
6.74 |
1986-2000 |
| Greece |
6.47 |
1992-2000 |
n/a |
n/a |
| Ireland |
11.39 |
1988-2000 |
4.39 |
1993-2000 |
| Italy
|
5.16 |
1973-2000 |
7..23 |
1986-2000 |
| Luxembourg |
15.87 |
1988-2000 |
n/a |
n/a |
| Netherlands |
14.06 |
1971-2000 |
7.43 |
1986-2000 |
| Portugal |
2.16 |
1988-2000 |
-0.31 |
1996-2000 |
| Spain |
4.79 |
1970-2000 |
0.85 |
1992-2000 |
| Sweden |
18.25 |
1980-2000 |
2.95 |
1992-2000 |
| U.K. |
8.06 |
1970-2000 |
7.62 |
1986-2000 |
| U.S. |
7.42 |
1970-2000 |
3.99 |
1970-2000 |
Sources: Ibbotson Associates, Stocks, Bonds, Bills, and Inflation: Classic
Edition Yearbook; and Elroy Dimson, Paul Marsh, and Mike Staunton, The
Millennium Book, A century of Investment Returns (London: London Business School
and ABN AMRO, 2000).
- Table 2 covers the entire 20th century. All show a Real Return
of more than 6%.
Table 2
Average Annual Real Returns for Stock and Bond Markets 1900-2000
Country
|
Equity Return |
Government Bond Return |
| Denmark
|
6.2 |
3.3 |
| France
|
6.3 |
0.1 |
| Germany (excludes
1922-23) |
8.8 |
0.3 |
| Italy
|
6.8 |
-0.8 |
| Netherlands
|
7.7 |
1.5 |
| Sweden
|
9.9 |
3.1 |
| United Kingdom
|
7.6 |
2.3 |
| United States
|
8.9 |
2.0 |
Source: Elroy Dimson, Paul Marsh, and Mike Staunton, Triumph of the
Optimists: 101 Years of Global Investment Returns (Princeton, N.J.: Princeton
University Press 2002), p.60.
- Table 3 shows an average annual return of 7.9% during the last three
quarters of the 20th century (70% stock and 30% bonds).
Table 3
Source: Ibbotson Associates, Stocks, Bonds, Bills, and Inflation: Classic
Edition Yearbook 2001, Tables C-1, C-2, C-3, C-4.
Note: Assumes a portfolio comprised of 70 percent stocks (90 percent large
cap, 10 percent small cap) and 30 percent bonds (50 percent corporate, 50
percent government).
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