Over any 20-year time period since 1928, the S&P 500 has NEVER lost money…

I am not trying to sell you on a lie about the stock market, I am guaranteeing anything in the future. However, if you take a look back since 1928, over any 20 year time frame, the S&P 500 has ALWAYS been positive. This means, from 1928-1948 = positive returns. From 1956-1976 = positive returns. From 2000-2020 = positive returns. Don’t listen to me, listen to the data (shown below).

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The Data:

I know at first glance, it sounds fake. I know at first glance, you want to call BS on that. I know at first glance, it sounds too good to be true. But, don’t take it from me, take it from the actual data.

One of my favorite sayings is “Men lie, Women lie, Numbers don’t”… well here are the numbers:

Over a 10 year time frame:

Only 11 out of the 81 ten-year periods did the S&P have a negative return. That is only 12% of the time.

The best 10 year period: 17.9% annual returns (1949-1958)

The worst 10 year period: -3.8% annual returns (1999-2008)

But, like I always say, if we zoom out, things get better.

Over a 20 year time frame:

Exactly 0% of the 20 year time periods since 1928 had a negative return. ZERO.

The best 20 year period: 13.2% annual returns (1980-1999)

The worst 20 year period: 0.6% annual returns (1929-1948)

While 0.6% returns is not the most ideal return over a 20 year average, the important thing is this: You would have not lost money.

Over a 40 year time frame:

I show this graph to help you understand how powerful a long term mindset is. While the 20 year data is powerful, the 40 year data is even more interesting.

The best 40 year period: 8.8% annual returns (1933-1972)

The worst 40 year period: 6.5% annual returns (1969-2008)

This is interesting for 2 reasons:

1. The best 40 year time period “only” had an 8.8% annual return while in the 20 year time period, the best return was 13.2% annual returns.

2. The worst 40 year time period still returned a 6.5% annual return per year.

I find this interesting because we commonly hear “everything reverts back to the mean” & after accounting for inflation, the S&P 500 has historically done ~8% per year. So in the 40 year time periods, although not having the highest rate of return, it also does not have the lowest rate of return either. Everything reverts back to the mean.

What can we do with this data?

Nothing is guaranteed in the market. Just because over any 20 year time period (in the past) the stock market has never lost money, does not mean it will continue that trend into the future. BUT, it is hard to invest against 100%.

For me, I read this data like this: The longer I have a time horizon, the chances of me losing money goes drastically down. The chances of me making money goes drastically up.

My Buys This Week:

This week I did my normal buys like always. Just like stated above, I keep my strategy simple, yet effective. DCA, buy weekly, don’t overthink, don’t try & time the market. Just buy.

ETFs: $250 in VOO + $100 in SCHD (from options income) +

Individual Stocks:

Tweet of the Week:

Do you lay in bed at night thinking the same things that I do?

Thank you so much for reading & I will see you next week! Until then, keep buying assets & stacking those dividends. 🙂 

- Decade Investor