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Wednesday, December 23, 2009

Why shares?

Historically shares have outperformed all the other investment instruments and given the maximum returns in the long run (see the table on page 7). In the twenty-fiveyear
period of 1980-2005 while the other instruments have barely managed to generate returns at a rate higher than the inflation rate (7.10%), on an average shares have
given returns of about 17% in a year and that does not even take into account the dividend income from them. Were we to factor in the dividend income as well, the shares would have given even higher returns during the same period Historically shares have outperformed all the other investment instruments and given the maximum
returns in the long run (see the table on page 7). In the twenty-fiveyear period of 1980-2005 while the other instruments have barely managed to generate returns at a rate higher than the inflation rate (7.10%), on an average shares have given returns of about 17% in a year and that does not even take into account the dividend income from them. Were we to factor in the dividend income as well, the shares would have given even higher returns during the same period

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