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Strategies & Market Trends : Value Investing

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research1234
To: Paul Senior who wrote (56667)1/16/2016 7:58:49 PM
From: E_K_S1 Recommendation   of 78650
 
The S&P 500 Dividends Reinvested Price Calculator (With Inflation Adjustment)

Been thinking about investments specifically the last 20 years. I remember Wall Street Week and Sir John Templeton. In the early 80's he was quoted as saying DOW 10,000 by the year 2000. That was totally unbelievable but it happened.



I used the above S&P calculator to see just what the compounded return was for the S&P from 1985 - 2000 vs @ 2000 - 2015.

I was quite surprised by the results ( you do the calculations). I still use a lot of the same fundamental valuation screens for my Buys and focus on buying good companies at an undervalued price and holding forever.

I guess those that only started investing in 2000 may feel a bit skeptical about the buy and hold strategy. I too would be with the compounded returns from 2000-2015..

I am not too sure why the compounded rates of return were/are so low (maybe it is the time period you look at) but the 2008/2009 crash and/or the internet bubble crash of 2001 may have been part of the story.

I started investing in the late 70's and pretty much added money every year in the 80's through 1990. I watched Wall Street Week and had a large holding in John Templeton's fund. In fact, I used his top 10 holdings as my individual stock picks during that 20 year period from 1980-2000. Many of those buys did very good.

Some say Templeton was better than George Soros, Peter Lynch and Warren Buffet combined.

My takeaway is you have to keep everything in perspective. I still think the U.S. market is the best market in the world ti invest in and will be for the foreseeable future.

EKS
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