Here's the Average Stock Market Return Over the Last 20 Years
The U.S. stock market is often divided into three major indexes, all of which moved higher over the past year as recession fears diminished. The S 500 (SNPINDEX: ^GSPC) advanced 27%, the Dow Jones Industrial Average (DJINDICES: ^DJI) advanced 18%, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) advanced 40%.
However, one-year returns tell investors very little. Vanguard founder John Bogle once wrote, "Reversion to the mean is a rule of life in the investing world." He compared the phenomenon to gravity. An index may outperform or underperform its historical average during certain periods, but performance is typically pulled back to the average over time.
Read on to see how all three major indexes performed over the past 20 years.
Source Fool.com
