Today’s chart comes from Wealthmanagement.com. It shows the drawdowns, which is the percent the market is down from the previous record high, going back to 1970. As you would expect, the chart shows most the time the market is “down” and investors spend a lot of time having “lost” money.
However, we also know that during this time the cumulative return has been an incredible 18,750%, which works out to an annual return of 10.4%.
As the great Jack Bogle, founder of Vanguard, said, “The mistakes we make as investors is when the market’s going up, we think it’s going to go up forever. When the market goes down, we think it’s going to go down forever. Neither of those things actually happen.”
About the Author
Samuel A. Kiburz
Samuel serves as Senior Vice President, Chief Investment Officer for the Crews family of banks. He manages the individual investment holdings of his clients, including individuals, families, foundations, and institutions throughout the State of Florida. Samuel has been involved in banking since 1996 and has more than 20 years experience working in wealth management.
Investments are not a deposit or other obligation of, or guaranteed by, the bank, are not FDIC insured, not insured by any federal government agency, and are subject to investment risks, including possible loss of principal.