Historical Returns S&P 500

S&P 500 Historical Returns 1950-2008

2010-03-19T19:03:00.001-07:00

Please look below for the list of historical returns for S&P 500 Index

As you can see above, returns for the index varied significantly each decade. Look at your right to see more in depth analysis of the returns.
S&P 500 index has been published since 1957, which is the weighted index of the 500 large-cap common stocks. Although the official data is only available from year 1957, we can still calculate the Historical return for s&P 500 index from earlier years by taking the very same companies. This exact thing has been done on the below graph which is the calculation starting from year 1926.

The average return since 1950 was 10.8%, but if the inflation is subtracted then the real total return is 6.8%. However, this by any means does not guarantee that this is the percentage you will earn. Calculating the expected return will give you a better estimate, but even then it does guarantee anything. To show you an illustration, if we were to compute the expected return over the past three year period with 10% return for each year, then the average return would be 10%. (10%+10%+10%)/3 = 10%.

But if we were to calculate the expected return for next year and if we knew this information:
Probability of a Boom = 0.2, Return if occurs = 15%
Probability of a Recession = 0.2, Return if Occurs = 0%
Probability of an average stage = 0.6, Return if occurs = 10%
The the expected S&P 500 index return for next year would be, (0.2*15)+(0.2*0)+(0.6*10) = 8%

1959-1968 Historical Returns S&P 500

2010-02-21T19:07:00.000-08:00

Below you can see S&P historical returns from years 1959-1968

Using the data from the table above, it can bee seen that the average return for the ten years ranging from 1959-1968 was 10.73% This of course right around the actual average return for the time period in which the S&P 500 index existed.

1969-1979 S&P500 Historical Returns

2010-02-21T18:58:00.000-08:00

Below I will present historical returns for S&P 500 index from years 1969-1979

Using the data above, I calculated the average return for the ten years shown above from 1969-1978. The average return was only 4.809% which arguably very low for such index. Some of downturn times in economics can be used as a reasoning for it

1979-1988 S&P500 Historical Returns

2010-02-21T18:10:00.000-08:00

Below I will present historical returns for S&P 500 for years from 1979-1988

Over this ten period year, S&P 500 index averaged to have return of 16.86% percent.
Once again this is not an expected return because the probability of the state of the economy occurring differs greatly. For instance recessions have a greater probability of occurrence.

1999-2009 S&P500 Historical Returns

2010-02-21T14:43:00.000-08:00

Below I will present the returns for S&p 500 from years 1999-2009.

From this graph above it can be seen that the average historical return for S&P 500 index has been 3.01%. This is way worse than the returns we averaged on years from 1988-1998 in which it was around 19%. These abnormally low or negative returns in some of the past years are due to economic downturns. The economy was at its all time low in 2008 since the great depression while the early millenium years also experienced downfall in the economy. So keeping in mind these two past recessions is a good idea when lookign at the returns.

1988-1998 S&P Returns

2010-02-21T14:21:00.000-08:00

Historical Returns for S&P 500 from 1988-1998

From this graph above, it can be seen that in years from 1989-98 the historical returns for S&P 500 averaged to be 20.056%. Of course this is only a simple average return and not the expected return. Expected return for S&P 500 would have been different based on the probability of each of the state of economy occurring. Still, this simple average return over the specified period above gives a pretty good estimate of the returns.

Historical Returns for S&P 500

2010-02-20T22:49:00.000-08:00

Below is the graph of S&P 500 returns which I have gotten from the site www.simplestockinvesting.com

From the chart above, it can be seen that the total average return from 1950 till 2008 was 10.76%. This percentage takes into consideration dividends plus the capital gain (price change).
But if the returns are adjusted for inflation then we get an average total return of 6.76%
Not too bad of an index to have. Because most of the stock analysts can never even beat the S&P 500 index over the long run. However, everything depends on your risk aversion. I would prefer just holding small cap value stocks index. Below you can get into more detailed historical return for S&P 500 index

S&P 500 is the index of the prices of the 500 large-cap common stock companies actively traded in the United States. This index has been followed since 1957. This index is the second most followed index after Dow Jones Industrial Average. Below I will present several tables in which you will be able to see the historical returns for S&P 500 Index

Historical returns for S&P 500 since 1926

Here is a more recent table of historical returns for S&P 500 since 1988

Historical returns for S&P 500 Index has varied very much over the years. Overall, S&P 500 can serve as a pretty good representation of an overall market. So when speaking of the market index, it can very well be assumed that it is being spoken of the S&P 500 index.

The S&P 500 index has been quite volatile over the years however it usually averages on a pretty good return. 2009 turned out to be a good year for the index and it earned a surprising 26.45%. And in the past 20 years the average return for S&P 500 has been around 10%.