Monday, July 6, 2009

Only 25%?

Earlier we wrote that only 25% of stocks outperformed the market.  William J. Bernstein writing in Money Magazine provides further information:

"In fact, researchers at the investment management firm Dimensional Fund Advisors found that from 1980 to 2008, the top-performing 25% of stocks were responsible for all the gains in the broad market, as represented by the University of Chicago's CRSP total equity market database (see the chart).

"As for the bottom 75% of stocks in the U.S. market, they collectively generated annual losses of around 2% over the past 29 years."

Read the entire article here:

http://money.cnn.com/2009/05/09/magazines/moneymag/stock-strategies.moneymag/index.htm