The average stock market returns over the past 15 years are:

The stock market is one of the greatest wealth creators ever invented. And with the introduction of low-fee investment accounts and index funds, investing in the stock market has never been easier.

Many investors will look to history to see what kind of returns they can expect in the future. And for all the stock’s volatility, it’s proven to be surprisingly stable for long-term buy-and-hold investors. Stock prices may rise one year and fall the next, but they always increase in value over the long term.

The past 15 years have been one of the strongest 15 years in history. Investors may be wondering whether the strong returns of the past decade and a half will continue, or whether they can expect more moderate returns going forward. To understand whether the average stock market returns over the past 15 years are repeatable, it’s important to look back at history.

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The average stock market returns over the past 15 years are:

The last 15 years began in early 2009. The market was coming off a massive stock sell-off that began in October 2007, fueled by the global financial crisis that led to the Great Recession. The bear market eventually S&P500 (^GSPC 0.08%) It reached its lowest point in March 2009, down 57% from its peak.

The next decade saw exceptional returns for benchmark indices. Here’s how it’s been over the past 15 years.

Data source: Aswath Damodaran from NYU Stern.

From 2008, it took another 10 years for the market’s annual total return to turn negative, and it declined slightly in 2018. The market did not experience another major decline until the onset of the coronavirus pandemic in 2020, when stocks recovered from the bear market with unusual speed as the Federal Reserve and the federal government supported the economy. Because I intervened for. The stock market didn’t have a meaningful down year until it entered a bear market in 2022.

Overall, the S&P 500 has grown at a compound annual growth rate of 13.8% over the past 15 years. Adjusted for inflation, the index grew 11.2% annually over this period.

However, if we move this period back just one year, including the severe bear market of 2008, the strong return in 2023 is reduced, but the 15-year return is only 8.7%, or 6.4% when adjusted for inflation. It can make a big difference from year to year.

What can investors expect in 2024 and beyond?

The stock market has been very strong over the past 15 years, with above-average performance, but not unprecedented.

Investors who invested in the stock market after the United States entered World War II enjoyed very strong returns over the next 15 years, even after accounting for the immediate postwar inflation problems. Similarly, those who were lucky enough to start investing in the 1980s as they battled high interest rates and inflation may be in a position to take advantage of the stock market boom of the late 1990s.

On the other hand, investors who did not enter the market until the 1960s experienced relatively low returns, hampered by high inflation that continued well into the 1970s. Similarly, anyone who was investing in the late ’90s, in the midst of the stock market euphoria, was hit by the dot com bubble burst and the Great Recession.

We cannot predict what the next 15 years will bring. Historically, the S&P 500 index has outpaced inflation by about 6.5% per year. However, as the past 15 years have shown, stock prices can deviate significantly from the average in any given year, and even over his 15-year period.

Nevertheless, investors need to remain confident that over the long term, stock prices will continue to outpace inflation and ultimately create wealth for those who persevere.