The S&P 500's average return over the past decade has been around 10.2%, just under the long-term historic average of 10.7% since the index's inception. This steady performance has made the S&P 500 a reliable benchmark for measuring the overall performance of the U.S. stock market.
The average stock market return is about 10% per year, as measured by the S&P 500 index, but that 10% average rate is reduced by inflation. Investors should consider the effects of inflation when evaluating the real return on their investments.
Since 1971, the S&P 500 has delivered an annualized return of 7.58%—or 10.51% with dividends reinvested. This consistent performance has made the S&P 500 a popular choice for long-term investors looking to build wealth over time.
If the S&P 500 profit margin continues to follow that trendline, for calendar 2024 it will be above 12% — well-above the 30-year average of 8%. This potential increase in profit margin could lead to even higher returns for investors in the coming years.
At the end of August last year, the S&P 500 was up 17%. Fast-forward to 2024, and the index is up nearly 19%. As they say in New Orleans, the S&P 500 is "laissez les bon temps rouler" - let the good times roll for investors enjoying these gains.
The S&P 500, Dow Jones Industrial Average (Dow), and Nasdaq Composite are all stock market indexes used to measure the performance of different sectors of the market. Investors often use these indexes to track the overall health of the stock market and make informed investment decisions.
This chart shows the largest positive and negative contributors to the total return of the S&P 500 in the first five months of 2024. Analyzing these contributors can help investors understand the factors driving the index's performance and make strategic investment choices.
The S&P 500 Index (Standard & Poor's 500 Index) is a market-capitalization-weighted index of 500 leading publicly traded companies in the United States. This diverse representation of the market makes the S&P 500 a reliable indicator of the overall health of the U.S. economy.
What will happen to the US stocks? Find out in our S&P 500 forecast for the rest of 2024, 2025 and beyond. Stay informed on the latest market trends and projections to make educated decisions about your investments.
