What Is The Average Return in the Stock Market?

The average stock market return is the percentage change in the stock market value for one year or a period of years.

Talking averages are always tricky when you are talking about  lumpy numbers.

Historically, the average stock market return has been roughly 10%, before inflation, annually.

However, returns each year are far from the average,

The Stock Market Fluctuates

Daily, prices can gyrate wildly with 24-hour financial news chatter you should ignore.

Measuring Stock Market Returns And Why S&P 500 Matters

The S&P 500 composite index is the most widely accepted benchmark of the stock market returns of experienced investors.

The S&P 500 composite index is a broader market benchmark, tracking 500 stocks of large, established companies.

Although there are thousands more stocks trading on the US stock exchanges, the S&P makes up about 80% of the entire stock market value.

Take A Long Term View of The Market

You have a better chance of attaining a 10% average stock market return when you take on a long-term view.

Bull Markets, Bear Markets, And Market Corrections

Since 1871, the stock market has spent 40% of all years rising or falling more than 20%. Thus booms and busts are normal.

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