Hello everyone,,
The type of industry that dominates the FTSE 100 are large mature businesses in a world of tepid growth.
There are two reasons why equity investments have done well recently: 1) recovery from the 2008 crisis, and 2) performance of the US stock market. And within the S&P 500, only a handful of companies have out-performed.
If it wasn't for Amazon, Apple, Facebook, etc., the US stock market would be at 1999 levels too.
This isn't a bad thing, it would be unsustainable if stock markets literally went up 10% year-on-year for no real reason, even if that would make everyone's life easier.
But don't forget dividends. 20 years of 4% dividends, if re-invested, would turn £10,000 into £20,000. More realistically, if you had started with £10,000, added £1,000/year, even if the index stays level, with the addition of dividends, you'd end up with: £52,000 for "only" £30,000 invested.
TL;DR - don't avoid the stock market just because of headline numbers that look flat.
The type of industry that dominates the FTSE 100 are large mature businesses in a world of tepid growth.
There are two reasons why equity investments have done well recently: 1) recovery from the 2008 crisis, and 2) performance of the US stock market. And within the S&P 500, only a handful of companies have out-performed.
If it wasn't for Amazon, Apple, Facebook, etc., the US stock market would be at 1999 levels too.
This isn't a bad thing, it would be unsustainable if stock markets literally went up 10% year-on-year for no real reason, even if that would make everyone's life easier.
But don't forget dividends. 20 years of 4% dividends, if re-invested, would turn £10,000 into £20,000. More realistically, if you had started with £10,000, added £1,000/year, even if the index stays level, with the addition of dividends, you'd end up with: £52,000 for "only" £30,000 invested.
TL;DR - don't avoid the stock market just because of headline numbers that look flat.
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