Article · Stocks
Average stock market return
From January 1871 to October 2026 the US stock market — the S&P 500 and the indexes it continues — returned 9.4% a year with dividends reinvested. After inflation that is 7.1% a year. The price alone rose 4.9% a year; reinvested dividends did the rest.
$1 invested in January 1871 grew to $1.19M
the buying power of $1 grew ×44.2K
without dividends: $1 became $1,739
73% of the years 1872–2025; after inflation 107 (69%)
the “about 10%” figure; the median year was 13.2%
9.3% or 10.9%? Two kinds of average
Add up the returns of all 154 calendar years from 1872 to 2025, divide by 154, and you get 10.9% a year — the arithmetic average and the source of the popular “stocks return about 10% a year”. But returns compound: a year of −50% followed by a year of +50% averages 0%, yet leaves a quarter of the money gone.
What money actually grew at, year after year, is the compound annual growth rate: 9.3% a year over the same years. The more returns swing, the wider the gap between the two. Both numbers are correct; only the compound one tells you where a dollar ended up.
| Average | With dividends | After inflation | Price only |
|---|---|---|---|
| Arithmetic average of yearly returns | 10.9% | 8.6% | 6.4% |
| Compound annual growth (CAGR) | 9.3% | 7.1% | 4.8% |
| Median year | 13.2% | 10.1% | 8.6% |
Calendar years 1872–2025, from the December average to the December average; compound growth from December 1871 to December 2025. “After inflation” includes dividends.
Every year since 1872, one brick each
Each brick is one calendar year, placed by its return with dividends. The market ended 113 of 154 years higher (73%). Most years land between 0% and +30%, yet the “average year” is rare: only 8 years came within two points of 10.9%.
The worst year was 1931 at −41.8%; the best, 1933 at +54.4%. After inflation the worst was 2008: −39.3%. 2026 so far: +13.7% to October 2026 (+9.8% after inflation); it joins the chart when the year is over.
The chart as a table
| Return in the year | Years | Which years |
|---|---|---|
| +50% … +60% | 1 | 1933 |
| +40% … +50% | 4 | 1879, 1908, 1935, 1954 |
| +30% … +40% | 17 | 1904, 1915, 1927, 1928, 1936, 1945, 1955, 1958, 1961, 1975, 1980, 1985, 1989, 1995, 1997, 2009, 2024 |
| +20% … +30% | 31 | 1880, 1885, 1891, 1898, 1901, 1918, 1919, 1922, 1924, 1925, 1938, 1943, 1944, 1950, 1951, 1963, 1967, 1972, 1976, 1983, 1986, 1991, 1996, 1998, 1999, 2003, 2013, 2017, 2019, 2021, 2023 |
| +10% … +20% | 31 | 1872, 1874, 1878, 1886, 1897, 1899, 1900, 1905, 1909, 1921, 1926, 1942, 1949, 1952, 1959, 1964, 1965, 1968, 1971, 1979, 1982, 1988, 1992, 2004, 2006, 2010, 2012, 2014, 2016, 2020, 2025 |
| 0% … +10% | 29 | 1875, 1881, 1882, 1888, 1889, 1892, 1894, 1895, 1896, 1902, 1906, 1911, 1912, 1916, 1923, 1939, 1947, 1948, 1953, 1956, 1970, 1978, 1984, 1993, 1994, 2005, 2007, 2011, 2015 |
| −10% … 0% | 22 | 1873, 1877, 1883, 1887, 1890, 1910, 1913, 1914, 1929, 1934, 1940, 1946, 1957, 1960, 1962, 1966, 1977, 1981, 1987, 1990, 2000, 2018 |
| −20% … −10% | 11 | 1876, 1884, 1893, 1903, 1920, 1932, 1941, 1969, 1973, 2001, 2022 |
| −30% … −20% | 5 | 1907, 1917, 1930, 1974, 2002 |
| −40% … −30% | 2 | 1937, 2008 |
| −50% … −40% | 1 | 1931 |
The best and the worst years
The ten best and ten worst calendar years. The switch above the brick chart shows them after inflation.
| Year | Return |
|---|---|
| 1933 | +54.4% |
| 1879 | +49.4% |
| 1954 | +48.1% |
| 1935 | +47.0% |
| 1908 | +45.1% |
| 1995 | +38.4% |
| 1945 | +38.1% |
| 1928 | +38.1% |
| 1975 | +38.0% |
| 1958 | +37.8% |
| Year | Return |
|---|---|
| 1931 | −41.8% |
| 2008 | −39.2% |
| 1937 | −31.9% |
| 1907 | −29.5% |
| 1974 | −26.1% |
| 1917 | −25.2% |
| 1930 | −24.0% |
| 2002 | −20.2% |
| 1920 | −18.5% |
| 1973 | −16.9% |
The longer you held, the narrower the range
Here is every holding period that started in any month since January 1871: the best, the median and the worst return a year. Over one year the outcome ranged from −62.3% to +139.8%, and 27% of all one-year periods lost money.
Over 20 years even the worst start, September 1929, still earned +2.0% a year with dividends. Before inflation no period of 20 years or longer lost money; after inflation none of 25 years or longer did, and the worst 20 years, from June 1901, returned −0.2% a year.
| Held for | Worst, a year | Median | Best, a year | Periods with a loss |
|---|---|---|---|---|
| 1 year | −62.3%from Jun 1931 | +11.3% | +139.8%from Jul 1932 | 27.2% |
| 2 years | −49.3%from Jun 1930 | +10.4% | +53.1%from Jun 1932 | 20.1% |
| 3 years | −40.2%from Jul 1929 | +10.0% | +39.7%from Mar 1933 | 15.1% |
| 5 years | −17.3%from Sep 1929 | +9.8% | +33.7%from Sep 1924 | 10.2% |
| 10 years | −4.0%from Aug 1929 | +8.8% | +21.2%from Jun 1949 | 2.9% |
| 15 years | −0.4%from Sep 1929 | +8.6% | +19.3%from Jul 1984 | 0.1% |
| 20 years | +2.0%from Sep 1929 | +8.2% | +17.9%from Apr 1980 | 0.0% |
| 25 years | +3.8%from Jun 1907 | +9.0% | +17.1%from Dec 1974 | 0.0% |
| 30 years | +3.6%from Jun 1902 | +9.9% | +14.3%from Jul 1970 | 0.0% |
Decade by decade
The best decade was the 1950s at +19.3% a year with dividends; the worst, the 2000s, at −0.7%. After inflation the worst decade was the 2000s: −3.2% a year.
Decades as a table
| Decade | With dividends | After inflation | Price only |
|---|---|---|---|
| 1870s* | +7.8% | +10.9% | +1.2% |
| 1880s | +6.0% | +8.3% | +0.8% |
| 1890s | +5.7% | +5.6% | +1.2% |
| 1900s | +10.3% | +7.7% | +5.5% |
| 1910s | +4.5% | −1.9% | −1.4% |
| 1920s | +15.2% | +16.3% | +9.1% |
| 1930s | 0.0% | +2.1% | −5.3% |
| 1940s | +8.9% | +3.4% | +2.9% |
| 1950s | +19.3% | +16.7% | +13.6% |
| 1960s | +7.8% | +5.1% | +4.4% |
| 1970s | +5.8% | −1.4% | +1.7% |
| 1980s | +17.3% | +11.6% | +12.5% |
| 1990s | +18.0% | +14.6% | +15.1% |
| 2000s | −0.7% | −3.2% | −2.5% |
| 2010s | +13.3% | +11.4% | +11.1% |
| 2020s* | +15.5% | +11.1% | +13.9% |
* Not a whole decade: from the first month of the data, or to the latest one (October 2026).
Where the return comes from
$1 invested in January 1871 grew to $1.19M by October 2026 with every dividend reinvested — but to only $1,739 on price alone. Reinvested dividends lifted the return from 4.9% to 9.4% a year.
After inflation, the dollar's buying power grew ×44.2K with dividends and only ×64.6 without: 7.1% against 2.7% a year. Most index charts show the price only, which is why the long-run return of stocks is so often understated.
The last 5, 10, 20 and 30 years
Over the last 10 years, from October 2016 to October 2026, the market returned +15.5% a year with dividends (+11.8% after inflation) — well above the long-run 9.4%. Short periods swing far from the long-run average, in both directions.
| Period | With dividends | After inflation | Price only | Growth with dividends |
|---|---|---|---|---|
| Last 5 yearsOct 2021 – Oct 2026 | +13.2% | +8.9% | +11.6% | ×1.86 |
| Last 10 yearsOct 2016 – Oct 2026 | +15.5% | +11.8% | +13.7% | ×4.23 |
| Last 20 yearsOct 2006 – Oct 2026 | +11.1% | +8.3% | +9.1% | ×8.2 |
| Last 30 yearsOct 1996 – Oct 2026 | +10.2% | +7.5% | +8.3% | ×18.6 |
| Last 50 yearsOct 1976 – Oct 2026 | +11.9% | +8.0% | +9.0% | ×277 |
| Last 100 yearsOct 1926 – Oct 2026 | +10.5% | +7.3% | +6.6% | ×21.5K |
| Since 1871Jan 1871 – Oct 2026 | +9.4% | +7.1% | +4.9% | ×1.19M |
To the latest month of the data; compound return a year.
Questions people ask
What is the average stock market return over the last 10 years?
From October 2016 to October 2026 the S&P 500 returned +15.5% a year with dividends reinvested, +11.8% after inflation and +13.7% on price alone.
Where does the “10% a year” figure come from?
It is the arithmetic average of yearly returns with dividends, before inflation: 10.9% for 1872–2025. Compounded, the same years give 9.3% a year, and 7.1% after inflation.
How often does the stock market lose money in a year?
In 41 of 154 calendar years (27%) since 1872; after inflation in 47 (31%). Over ten-year periods a loss happened 3% of the time before inflation and 11% after it.
Why do different sites quote different averages?
They measure different things: other start and end dates, with or without dividends, before or after inflation, arithmetic or compound averages, year-end closing prices or monthly averages. This article uses Shiller's monthly averages, so single years look a little calmer here than in close-to-close tables.
Go deeper
How the numbers are calculated
- Data: Robert J. Shiller, Online Data (Yale University): the S&P Composite index (the S&P 500 and, before 1957, its predecessors), dividends and US consumer prices, monthly since January 1871.
- A calendar year runs from the December average to the December average (prices are monthly averages of daily closes), so single years differ from close-to-close figures.
- With dividends: dividends are reinvested into the index every month (total return).
- After inflation: values are divided by the US consumer price index of their month.
- Holding periods start in every month since January 1871 and overlap; the return a year is compound: (end ÷ start)^(1 / years) − 1.
- Shiller's notes on the latest months: Oct price is Oct 2nd close; Sept/Oct CPI estimated; Oct GS10 is Oct 2nd value.
- Past returns are history, not a forecast. Nothing here is investment advice.