There are several factors that drive future investment returns. The important drivers behind future returns on equity investments include:
While these are important drivers of future returns, it is equally important to keep as much of any returns as possible. In order to do that, investors need to be mindful of all costs. In order to reduce taxes, it is advisable to place as much shares as possible in a tax-deferred account such as a Roth IRA for example. In taxable accounts, it is advisable to refrain from too much trading, in order to let the power of tax-deferred capital gains on long-term holdings do its magic. The other way to keep costs low is by putting money in the lowest cost broker. In my situation, this is Interactive Brokers, which charges me 35 cents/investment. It feels like a steal.