Franklin Templeton Investments
Public Site >Sign In  | Register
My Cart
My Cart Summary
Mandatory items may have been added.

<GAIN FROM OUR PERSPECTIVE>

2020 Vision

Find a Fund

By fund name, fund number, NASDAQ symbol or CUSIP

View All Funds

Asset Categories


Fund Families


Find Us

Follow Franklin Templeton

1. History Favors a Return to the Mean

Share This Material

Short-term volatility has always been a part of equity investing, but investors have benefited from the market’s long-term upward trend. Investors concerned about volatility would be wise to look closely at the market’s long-term history, especially following periods of weak returns.  

History Shows Positive Returns Have Outweighed Negative Returns

 

Annual Returns of the S&P 500 Index – Positive vs. Negative

S&P 500 Index Annual Returns
Chart is for illustrative purposes only and does not reflect the performance of any Franklin, Templeton or Mutual Series fund. Source: ©2010 Morningstar. Indexes are unmanaged, and one cannot invest directly in an index. Past performance does not guarantee future results.

As you can see above, annual returns were positive approximately 70% of the time. Measuring returns over 10-year time periods, you see that results worked in investors’ favor 95% of the time.




What's Next?

The historical 10-year returns following the worst 10-year period returns since 1926 have benefited those who were invested in stocks. The decade ahead remains a question mark.

S&P 500 Index Worst 10-Year Returns and Subsequent 10-Year Returns10-Year Periods Ended December 31

S&P 500 Index 10-Year Returns
Chart is for illustrative purposes only and does not reflect the performance of any Franklin, Templeton or Mutual Series fund. Source: ©2010 Morningstar. Indexes are unmanaged, and one cannot invest directly in an index. Since no subsequent 10-year results are available for years past 2000, only 2008 was included to demonstrate that the next 10 years are still unknown. For the 10-year period ended 2009, the S&P 500 Index returned -0.92%. Past performance does not guarantee future results. 

The Bottom Line

  • Investors shouldn’t use the most recent trend to extrapolate the future.
  • Market history tells a story very favorable to long-term investors.
  • Following a negative 10-year return, the subsequent historical 10-year return was positive.
  • Speak with a financial advisor for help creating a long-term investment plan focused on long-term results.


Another reason to be an equity investor: The World is Getting Smaller (and More Prosperous)


Are You a Financial Advisor?

Register for our Advisor Website

——or——

Sign In for more on 2020 Vision

Important Legal Information

For more information on any of our funds, contact your financial advisor or download a free prospectus. Investors should carefully consider a fund's investment goals, risks, sales charges and expenses before investing. The prospectus contains this and other information. Please read the prospectus carefully before investing or sending money.

You need Adobe Acrobat Reader 6.0 or higher to view and print PDF documents. Download a free version from Adobe's website.




    For U.S. residents only.