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Worldwide Investors Aren't Fully Aware Of The Risks Involved In Their Investments.

Mar. 23, 2021 2:16 PM ET1 Comment
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Plexor's Blog
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  • After the global financial crisis, world wealth has grown at a CAGR of 5.8%.
  • During the same period, the expected return on US stocks has been equal to 7.9% on average.
  • This means that, during the last 12 years, the risk borne by investors has paired that of an investment of slightly more than 70% in US stocks.
YEAR World Wealth* $ bn US ERP** US T.Bond Rate** Expected Return
2008 209.6 6.4% 2.2% 8.6%
2009 227.0 4.4% 3.8% 8.2%
2010 239.0 5.2% 3.3% 8.5%
2011 253.0 6.0% 1.9% 7.9%
2012 268.7 5.8% 1.8% 7.5%
2013 288.7 5.0% 3.0% 8.0%
2014 289.0 5.8% 2.2% 8.0%
2015 289.9 6.1% 2.3% 8.4%
2016 307.3 5.7% 2.5% 8.1%
2017 351.5 5.1% 2.4% 7.5%
2018† 351.5† 6.0% 2.7% 8.6%
2019† 360.6† 5.2% 1.9% 7.1%
2020† 400.2† 5.6%†¥ 1.1%†¥ 6.7%†¥
CAGR 5.8%
Raw data source: * Research Institute Credit Suisse
Raw data source: ** Damodaran Online
† mid year ¥ computed: monthly average

Analyst's Disclosure: I am/we are long put option on S&P500 index.

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