15% annual returns is realistic? (2024)

15% annual returns is realistic? (1)

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Louie Kwan 15% annual returns is realistic? (2)

Louie Kwan

Certified AWS Solutions Architect @ GOC.

Published Mar 2, 2020

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Stocks, in essence, should provide a greater return than bonds. However, they come with greater volatility along the way.

For the S&P 500, the generic long-term return is around 8 to 10 percent a year. Comparatively, if you are able to pick your own stocks which justifies the effort, you ought to be getting a 12-15 percent return over time. If not, your skills or techniques may be a bit flawed. If this occurs, you should step aside and just buy some good ETFs. The stock market is not for everyone and that is okay. The ugly truth is that it may be NOT worth your time to play in the stock market.

If you are investing emotionally, chasing trends and news, loading up on penny stocks, or failing to diversify, you should also step aside to avoid bigger potential missteps.

All these pitfalls notwithstanding, if you can develop some basic skills/ techniques and manage to make 15 percent over time, stocks are, in essence, one of the better asset classes. Investing in good companies means you own partial ownership rights in the company that entitles you to share the earnings that may occur and accrue. If you started with $100,000 in your RRSP or TFSA with 15% compound returns, it will bring you $813,706.16 in 15 years.

It is not worth your time to do any investment if it cannot bring you 12 to 15 percent per year. Investing properly is not a gamble. We should not lose money in the stock market on a long term basis. In fact, a near guaranteed return of 15% or higher is a realistic expectation.


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Louie Kwan

Certified AWS Solutions Architect @ GOC.


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15% to 20% is a norm.

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15% annual returns is realistic? (2024)


Is 15% annual return realistic? ›

It is not worth your time to do any investment if it cannot bring you 12 to 15 percent per year. Investing properly is not a gamble. We should not lose money in the stock market on a long term basis. In fact, a near guaranteed return of 15% or higher is a realistic expectation.

Is a 15 percent return on investment good? ›

What is a good ROI? While the term good is subjective, many professionals consider a good ROI to be 10.5% or greater for investments in stocks.

What is a realistic annual rate of return? ›

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 can expect to lose purchasing power of 2% to 3% every year due to inflation.

How to average 15% returns? ›

To calculate the average rate of return, add together the rate of return for the years of your investment, and then, divide that total number by the number of years you added together.

Is 10% return unrealistic? ›

That often cited 10-per-cent return for stocks based on the post-1950 period is roughly equivalent to a 7-per-cent real return in the historical data. That is about 2 per cent higher than unbiased estimates of U.S. expected returns, U.S. equity returns before 1950 and global stock returns spanning 1890 through 2023.

How much money do I need to invest to make $1000 a month? ›

A stock portfolio focused on dividends can generate $1,000 per month or more in perpetual passive income, Mircea Iosif wrote on Medium. “For example, at a 4% dividend yield, you would need a portfolio worth $300,000.

What is considered a good annual return? ›

General ROI: A positive ROI is generally considered good, with a normal ROI of 5-7% often seen as a reasonable expectation. However, a strong general ROI is something greater than 10%.

Is a 7% return realistic? ›

Even the 10% estimate doesn't include inflation, which has averaged about 3% a year, further reducing the historical return closer to 7%. Tack on things like fees and taxes, and even 7% is probably a relatively high long-term return assumption for a portfolio, especially based on market forecasts today.

What is the safest investment with the highest return? ›

These seven low-risk but potentially high-return investment options can get the job done:
  • Money market funds.
  • Dividend stocks.
  • Bank certificates of deposit.
  • Annuities.
  • Bond funds.
  • High-yield savings accounts.
  • 60/40 mix of stocks and bonds.
May 13, 2024

What if I invested $1000 in S&P 500 10 years ago? ›

Over the past decade, you would have done even better, as the S&P 500 posted an average annual return of a whopping 12.68%. Here's how much your account balance would be now if you were invested over the past 10 years: $1,000 would grow to $3,300. $5,000 would grow to $16,498.

Is 20% return possible? ›

Relatively safer investments may see less volatility in an average year, but if you have a long enough timeline, you have the potential to earn that 20% return eventually.

How much will 100k be worth in 30 years? ›

Answer and Explanation: The amount of $100,000 will grow to $432,194.24 after 30 years at a 5% annual return. The amount of $100,000 will grow to $1,006,265.69 after 30 years at an 8% annual return.

What is a good expected annual return? ›

A good return on investment is generally considered to be around 7% per year, based on the average historic return of the S&P 500 index, adjusted for inflation. The average return of the U.S. stock market is around 10% per year, adjusted for inflation, dating back to the late 1920s.

Is saving 15 of your income good? ›

For a successful retirement, you should aim to save at least 15% of your income annually over the course of your career. Saving steadily and increasing your contributions periodically should help you hit that target over time.

Is 20% return on investment good? ›

A 20% return is possible, but it's a pretty significant return, so you either need to take risks on volatile investments or spend more time invested in safer investments.

What is a realistic rate of return on a 401k? ›

Many retirement planners suggest the typical 401(k) portfolio generates an average annual return of 5% to 8% based on market conditions. But your 401(k) return depends on different factors like your contributions, investment selection and fees. Sometimes broader trends can overwhelm these factors.


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