Stocks and Holding Periods
See how longer holding periods reduce the range of best and worst returns on stocks.
The best annual rate of return for all 1 year periods (trailing returns by month) in the S&P/TSX Total Return Index since 1944 was 86.9%
while the worst was minus 39.2%. By extending the holding period to 30 years, the range of best and worst returns narrowed to 12.7% for
best and plus 7.2% for worst.
The charts below show the 1 month, 1, 3, 5, 10, 15, 20, 25 and 30 year trailing returns for the S&P/TSX Total Return Index for the 75 year period from 1944 to 2018. As the holding period gets longer, the returns become consistently more positive. The number of negative return periods drops off dramatically after 3 years (see table below). For example, there are only 15 negative holding periods for 5 year periods and none for the 10, 15, 20, 25 and 30 year periods.
Best and Worst Annualized Returns
S&P/TSX Total Return Index
(Jan 1944 to Dec 2018)
Source: Toronto Stock Exchange
S&P/TSX Total Return Index
(Jan 1944 to Dec 2018)
Source: Toronto Stock Exchange
The charts below show the 1 month, 1, 3, 5, 10, 15, 20, 25 and 30 year trailing returns for the S&P/TSX Total Return Index for the 75 year period from 1944 to 2018. As the holding period gets longer, the returns become consistently more positive. The number of negative return periods drops off dramatically after 3 years (see table below). For example, there are only 15 negative holding periods for 5 year periods and none for the 10, 15, 20, 25 and 30 year periods.
| Number of Periods With: | ||||
|
Holding Period |
Positive Returns |
Negative Returns |
||
| 1 mo. | (900 periods) Jan 01-31, 1944, Feb 1-28, 1944 … Dec 1 - 31, 2018 | 557 | 343 | |
| 1 yr | (888 periods) Jan 44 - Jan 45, Feb 44 - Feb 45 … Dec 17 - Dec 18 | 666 | 222 | |
| 3 yrs | (864 periods) Jan 44 - Jan 47, Feb 44 - Feb 47 … Dec 15 - Dec 18 | 783 | 81 | |
| 5 yrs | (840 periods) Jan 44 - Jan 49, Feb 44 - Feb 49 … Dec 13 - Dec 18 | 825 | 15 | |
| 10 yrs | (780 periods) Jan 44 - Jan 54, Feb 44 - Feb 54 … Dec 08 - Dec 18 | 780 | 0 | |
| 15 yrs | (720 periods) Jan 44 - Jan 59, Feb 44 - Feb 59 … Dec 03 - Dec 18 | 720 | 0 | |
| 20 yrs | (660 periods) Jan 44 - Jan 64, Feb 44 - Feb 64 … Dec 98 - Dec 18 | 660 | 0 | |
| 25 yrs | (600 periods) Jan 44 - Jan 69, Feb 44 - Feb 69 … Dec 93 - Dec 18 | 600 | 0 | |
| 30 yrs | (540 periods) Jan 44 - Jan 74, Feb 44 - Feb 74 … Dec 88 - Dec 18 | 540 | 0 | |
Select a holding period:
Compare another holding period:
Assumptions
Returns for all periods are measured using the closing month end values of the S&P/TSX Total Return Index from January 1944 to December 2018. The annual return is the annualized compound rate of return.
Disclaimer
Returns for all periods are measured using the closing month end values of the S&P/TSX Total Return Index from January 1944 to December 2018. The annual return is the annualized compound rate of return.
Disclaimer
