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Keep in mind that an index may also be constructed around the bond market, or even “road less traveled” asset classes such as commodities or real estate. Today, if you wish, you could literally hold all your wealth in a diversified portfolio of low-cost traditional index funds representing every asset class and every market sector within the United States or around the globe.
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Over the past century, the average nominal return on U.S. stocks was 10.1 per
1
Keep in mind that an index may also be constructed around the bond market, or even “road less traveled” asset classes such as commodities or real estate. Today, if you wish, you could literally hold all your wealth in a diversified portfolio of low-cost traditional index funds representing every asset class and every market sector within the United States or around the globe.
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Over the past century, the average nominal return on U.S. stocks was 10.1 percent per year. In real terms (after 3.4 percent inflation) the
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“Creative destruction” is the formulation of Joseph E. Schumpeter in his 1942 book
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“Economical,” “efficient,” and “honest” are the words I used in my 1951 Princeton University thesis, “The Economic Role of the Investment Company.” Some principles are eternal.
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To complicate matters just a bit, the Gotrocks family also purchased the new public offerings of securities that were issued each year.
