• Steve Crawley

Let's Be Patient



Warren Buffett states, “The stock market is a device to transfer money from the impatient to the patient.”

The stock market might go up or go down on any given day. The odds are about even—and impossible to predict. The good news, though, is that returns tend to even out as the timeframe expands. Between 1950 and 2020, according to data from J.P. Morgan:

  • The best one-year return was +47%, and the worst was -39%.

  • The best average annual return over a five-year period was 28%, and the worst was -3%.

  • The best average annual return over a ten-year period was 19%, and the worst was -1%.

  • The best average annual return over a twenty-year period was 17%, and the worst was +6%. In other words, the S&P 500 has never lost money over a 20-year period.

There are, of course, no guarantees, but as Buffett noted, the odds are greatly in our favor if we invest for the long term. Source: Adam Grossman

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