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Financial Planning -> Stocks, Bonds etc. -> Investment Returns

Historic Investment Returns

The Canadian Consumer Price Index has been quite stable since 1992.  In the 30 years from 1963 to 1992, the average annual increase (inflation rate) was 5.7%.  During that time, there were 5 years where the inflation rate was over 10%, including 1981, when the rate was 12.4%.  1981 is also the year when Canadian 5 year mortgage rates were over 21% for a couple of months.  The average 5 year mortgage rate from 1963 to 1992 was 11.03%.

Historical returns on $1,000 invested in stock markets and other investments
to December 31, 2013

Type of Investment 1 year 5 years 10 years 20 years Since
Jan 1, 1984
29 years
50 years Since
Jan 1, 1950
63 years
Avg
Annual
Return
Value Avg
Annual
Return
Value Avg
Annual
Return
Value Avg
Annual
Return
Value Avg
Annual
Return
Value Avg
Annual
Return
Value Avg
Annual
Return
Value
Cdn 3 month T-bills 1.0% $1,010 0.8% $1,038 1.9% $1,210 3.2% $1,861 4.9% $4,034 6.1% $19,651 5.4% $27,459
Cdn Govt Bonds 1 to 3 year 1.1% $1,011 1.3% $1,065 2.3% $1,259 3.7% $2,085 5.4% $4,580 6.5% $23,738 5.9% $37,010
Cdn Govt Bonds over 10 years 2.7% $1,027 3.2% $1,168 3.8% $1,451 5.1% $2,712 6.5% $6,271 7.5% $37,625 6.8% $63,968
S&P/TSX (Cdn) Index (formerly TSE300) 9.6% $1,096 8.7% $1,516 4.8% $1,599 5.6% $2,991 5.9% $5,249 n/a n/a n/a n/a
Nikkei 225 Index in Cdn$ 38.6% $1,386 8.1% $1,476 3.9% $1,467 0.3% $1,063 5.0% $4,120 n/a n/a n/a n/a
S&P 500 (US) Index in Cdn$ 41.5% $1,415 14.7% $1,982 4.5% $1,551 8.2% $4,811 10.5% $18,131 9.9% $113,996 11.0% $720,031
European stocks in Cdn$ 34.7% $1,347

10.9%

$1,679

5.0%

$1,623

7.4%

$4,205

11.5% $23,212 n/a n/a n/a n/a
Emerging markets stocks in Cdn$ (1) 4.5% $1,045

11.9%

$1,758

8.5%

$2,260

4.7%

$2,499

n/a n/a n/a n/a n/a n/a
Canadian Consumer Price Index All Items 1.2% $1,012 1.6% $1,083 1.7% $1,189 1.8% $1,434 2.5% $2,025 4.1% $7,605 3.7% $9.799

Value is the value at the end of the period, in Canadian$, of $1,000 invested at the beginning of the period.
n/a = not available

We added the column for returns since 1984 because 1984 is the earliest data that we have for the S&P/TSX index.

(1)  For Emerging Markets, the earliest data that we have is 1987.  The average annual return in Canadian dollars for emerging markets for the 26 years from 1987 is 11.2%.  $1,000 invested at the beginning of 1987 would have a value of $15,691 Canadian.

* Note that the average annual return on bonds is the average yield if the bonds were held to maturity.

The change in the Canadian dollar has had a significant effect on the above results.  As an example, see the following 10 year results in US$:

S&P 500 7.4% $2,043
European stocks 7.9% $2,137
Emerging markets stocks    11.5% $2,977

Sources of data used to calculate the above returns:
Bank of Canada Rates and Statistics - Interest Rates, Standard & Poor's, Statistics Canada, Yahoo, Morgan Stanley, UBC Pacific Exchange Rate Service.
The returns are the total returns with dividends or interest reinvested.
All values and returns are in Canadian $
We have added an estimate of 1.5% for annual dividends to calculate the total return index for the Nikkei 225.

Recommended Stocks

See our article on recommended stocks for registered or non-registered accounts - these suggested portfolios are good for novice investors.

Tip:  Calculate your own investment returns using our Investment Return Calculator.

 

Revised: October 04, 2014

 

 

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