It pays to stay invested in the long run…

The myth is equity investing is risky business. Find below a chart to show how it makes sense to stay invested in stocks in the long run. Holding stocks for a year or so may give negative returns but if held for more than 5 years returns have always been positive. (Even in 2008 when the markets crashed). So equity investments are not that risky if held for more than 5 years. If we have a good portfolio of stocks timing doesn’t matter, if held for more than 10 years expect double digit returns. To top it all the chart below only shows index returns & stock portfolios outperforming the index will give higher returns. Please note that returns calculated are only on the principle and not dividend, if included returns will be higher.

SENSEX Returns over the last 19 years
Returns (%)
DateSENSEX1357101215
YearYearsYearsYearsYearsYearsYears
27-Nov-982782       
26-Nov-99470569.13      
27-Nov-003969-15.64      
27-Nov-013288-17.175.72     
27-Nov-023174-3.45-12.3     
27-Nov-03498957.187.9212.39    
25-Nov-04603520.9722.445.11    
26-Nov-05888947.2940.9517.518.05   
27-Nov-061377454.9540.2833.1816.58   
27-Nov-071912838.8746.8943.2225.19   
26-Nov-089027-52.810.5112.5915.5212.49  
27-Nov-091663284.256.4922.4826.713.46  
26-Nov-101913715.060.0216.5721.1717.0417.43 
25-Nov-1115695-17.9820.252.6514.6316.9210.56 
27-Nov-121884220.054.25-0.311.3319.513.86 
27-Nov-13204208.382.1917.745.7915.1316.4414.21
28-Nov-142869440.5222.2811.525.9616.8720.1412.81
30-Nov-1526145-8.8811.546.4416.4111.3914.8013.39
30-Nov-16266521.949.2811.176.976.8213.1814.97
29-Nov-173360226.085.4012.278.375.8011.7217.04
No of Rolling Returns191715131085
Negative Returns6110000

Market valuations don’t matter in the long term

Retirement Planning – Invest Early, Invest Wisely

Sabyasachi Paul has been associated with equity research and advisory on equity markets in India for over 9 years & currently heads the equity research desk of Eastern Financiers Ltd, Kolkata.He also manages a portfolio on the online platform Kristal. Find link to the strategy named ‘The Tortoise’

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.