How Will Common Stocks Perform in the Future?

                       

I find a major disconnect among investors about what they expect to earn from their securities portfolio over the next ten, twenty and more years, after tax and inflation.

                       

Admittedly, that is a tough prediction because investors must take income taxes and inflation into account, along with projected securities’ yields and market returns. That isn’t simple.

                       

In one survey, the net/net/net predicted return by a number of experts over the next fifty years, estimated returns ranged only between 2% and 3% annually. That is unusual and shocking. Investors’ experience from the past would have had expectations to be close to about 6%.

                                           

In fact, many securities markets observers believe that potential, along with taxation and inflation bites, will impair future market returns. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)