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14 November 2023 Financial Analysts Journal Volume 80, Issue 1

Stocks for the Long Run? Sometimes Yes, Sometimes No

  1. Edward F. McQuarrie
Analyzing historical data for 19th century US stock and bond returns, this study challenges Jeremy Siegel’s “Stocks for the Long Run” thesis. Evidence indicates that 20th century US asset returns cannot be generalized out of sample.
Read the Complete Article in the Financial Analysts Journal CFA Institute Member Content In Practice: Member Companion Feature Read Brief CFA Institute Member Content Stocks outperform bonds by less than you think Read Financial Times Article Edward McQuarrie: Rethinking Portfolio Theory Listen to the Podcast

Author Shares Key Message


When Jeremy Siegel published his “Stocks for the Long Run” thesis, little was known about 19th-century stock and bond returns. Digital archives have made it possible to compute real total return on US stock and bond indexes from 1792. The new historical record shows that over multi-decade periods, sometimes stocks outperformed bonds, sometimes bonds outperformed stocks and sometimes they performed about the same. New international data confirm this pattern. Asset returns in the US in the 20th century do not generalize. Regimes of asset outperformance come and go; sometimes there is an equity premium, sometimes not.

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