Info · Reference
What each asset class has returned
Nearly a century of US data, in one place: how much stocks, bonds, cash, and gold have returned, how bumpy the ride was, and how they move relative to one another. It's the empirical backdrop for the site's whole thesis — that return is compensation for bearing undiversifiable risk. Each row below is a broad asset class, so what's compared here is the compensated kind; the risk of any single company inside them diversifies away and earns no premium. Past results never guarantee future ones; this is history, not a forecast.
1928–2025, United States Aswath Damodaran, Historical Returns on Stocks, Bonds and Bills (NYU Stern). Annual US series, 1928–2025. Nominal figures are arithmetic averages of annual returns; real returns are geometric (compounded) after CPI inflation. · source & method
The number that matters most: real returns
What you can actually spend is the return after inflation. Averaged over 98 years and compounded, here is what a dollar earned in real, purchasing-power terms:
- 6.8% US stocks, annualized real return — the reward for the roughest ride
- 1.5% 10-year Treasuries, annualized real
- 0.3% T-bills (cash), annualized real — barely ahead of inflation
Inflation itself averaged 3.0% a year over the period. The ranking is the whole story: the assets that swung the most also paid the most. That extra return is the risk premium.
Return and risk by asset class
Nominal (before inflation) figures across the full period. "Average annual return" is the arithmetic mean of yearly returns; "volatility" is their standard deviation — a plain measure of how much the yearly result bounced around.
| Asset class | Avg. annual return Arithmetic mean of annual nominal returns. It runs higher than the compound (geometric) growth you'd actually realize — the bigger the volatility, the bigger that gap. | Volatility |
|---|---|---|
| US stocks (S&P 500) | 11.8% | 19.4% |
| US small-cap value | 17.8% | 38.0% |
| Corporate bonds (Baa) | 6.9% | 7.6% |
| US Treasuries (10-yr) | 4.8% | 7.9% |
| T-bills (cash) | 3.4% | 3.0% |
| Gold | 7.4% | 21.5% |
Real estate is omitted here: the source's long-run series is a housing price index rather than a REIT total return, so it isn't comparable to the rest.
How the asset classes move together
Correlation of annual returns, from −1 (move exactly opposite) to +1 (move in lockstep). Low and negative pairings are what make diversification work: when one zigs, the other doesn't follow. Negative values are highlighted.
| US stk | SCV | Corp | 10y Tsy | T-bill | Gold | |
|---|---|---|---|---|---|---|
| US stk | 1.00 | 0.72 | 0.40 | 0.02 | -0.02 | -0.06 |
| SCV | 0.72 | 1.00 | 0.31 | -0.10 | -0.15 | 0.01 |
| Corp | 0.40 | 0.31 | 1.00 | 0.66 | 0.12 | 0.02 |
| 10y Tsy | 0.02 | -0.10 | 0.66 | 1.00 | 0.28 | -0.01 |
| T-bill | -0.02 | -0.15 | 0.12 | 0.28 | 1.00 | 0.14 |
| Gold | -0.06 | 0.01 | 0.02 | -0.01 | 0.14 | 1.00 |
Notice Treasuries and gold sit near zero or below against stocks — the reason a bond or gold sleeve can steady an equity portfolio.
Sources & method
Return, volatility, and correlations computed from Damodaran's annual US series; real returns compounded against CPI. Refresh when the dataset updates (npm run data:assets, npm run data:historical).
Research
- Dimson, E., Marsh, P., & Staunton, M. (2002). Triumph of the Optimists: 101 Years of Global Investment Returns. Princeton University Press.
- Jordà, Ò., Knoll, K., Kuvshinov, D., Schularick, M., & Taylor, A. M. (2019). “The Rate of Return on Everything, 1870–2015.” The Quarterly Journal of Economics 134(3): 1225–1298.
Data
- Historical Returns on Stocks, Bonds, Bills & Real Estate — United States, Aswath Damodaran, NYU Stern School of Business. Annual series from 1928 (histretSP.xls), published by the author without stated usage terms; used with attribution.
Educational use only, not financial advice. Every figure traces back to the sources above or to the inputs you set — the full method and the source code are public.