Comparing asset returns

Discussion in 'Wealth Creation & Management' started by mmm....shiney!, Nov 21, 2020.

  1. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    Return-Variation-Within-Asset-Classes-2.jpg

    The value at either end of each scale shows the variability of returns in each asset class eg gold returns on average 3.2% but it has been as low as a 29% loss and as high as a 26% gain over a 12 month period. Gold's best performing year was in 2007 while its worst was in 2013. In 2020 it's returning about 22%.

    The data that this table is drawn from is here: investment-returns-by-asset-class
     
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  2. sgbuyer

    sgbuyer Well-Known Member Silver Stacker

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    No bitcoin?
     
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  3. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    wasn’t invented in 1985. :)
     
  4. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    BTC annualised returns adjusted for inflation since August 1 2010.

    Mean over 10 years = 2294%
    Median over 10 years = 76%
    Highest annual return = 20927% (2010 - 2011)
    Lowest annual return = -0.53% (2013 - 2014)

    https://dqydj.com/bitcoin-return-calculator/

    August 1 2019 - August 1 2020 = 12%. Currently if you'd bought on January 1 2020 and sold on the 20/11/2020 you'd have made 155% profit. Timing is everything, and you've got to be lucky to maximise gains and reduce losses by timing the market. The best traders can probably lock in a lot of profit and minimise losses, but no one can do that consistently. The greatest long term trade of all time would've have been to buy BTC in 2010, sell the lot and buy ETH in 2016, sell the lot and buy BNB in 2019 and then sell the lot for USDT in 2019. No one did that.

    For most people we're better off buying an asset and then letting it run long term through the highs and lows and in the meantime get on with everything else we have to do in life.

    https://themeasureofaplan.com/marke...ansactionFeeInput=0&minYear=1980&maxYear=1994
     
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  5. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    And gold has a fairly lousy return for something that doesn't pay an income. I would've thought it would be higher considering the opportunity cost of owning it.
     
  6. JohnnyBravo300

    JohnnyBravo300 Well-Known Member

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    It all depends on the years you look at for comparison. That's the key.
    After the Great Depression the stock market was flat for 40 years but no one remembers that haha.
    The charts always start in the 80s.
     
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  7. willrocks

    willrocks Well-Known Member Silver Stacker

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    Anything is better than cash. Even old Holden cars.
     
  8. mmm....shiney!

    mmm....shiney! Well-Known Member Silver Stacker

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    That’s true. It’s because our monetary system changed about that time.

    And because it depends upon what years you look at, you have to be exposed to the varying asset classes.
     
  9. Eureka Moments

    Eureka Moments Well-Known Member Silver Stacker

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    What you need to do is change your plot points to show "Since 100th case reported" and then you can align the data from different timelines.
     
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  10. Eureka Moments

    Eureka Moments Well-Known Member Silver Stacker

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    Mate has 5 and his storage cost is 3 tarps and car covers every couple of years for the ones sitting outside.
    WB panelvan converted to a roofless ute, registered and on road a couple of times a year. Roll bar and work all engineered and legal.
    HR Prem left front pranged but all Nasco extras, bucket seats etc.
    EH Special sedan and near enough spares/extras to build another.
    EJ Wagon ex-farm driven so multi whacks underneath from hitting logs and rabbit holes. Back upholstery pristine as it was always folded down to fit bales of hay and livestock, dogs etc. Once my mate cleaned the remains of some sheep carcasses off the timber rear floor they came up a treat.
    FB sedan with plenty spares.

    Paid under $1000 for 3 of them and $10 000 top price for the WB ute. Any one of them could easily sell for up to 10 times his outlay and 4 of them bought since 2015. If he decided to pull any apart he could make way more selling individual parts for profit.
     
  11. oziwassabi

    oziwassabi Well-Known Member Silver Stacker

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    Buzz EH:D
     
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  12. Eureka Moments

    Eureka Moments Well-Known Member Silver Stacker

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    You could write forever about Holden (and other Australian produced cars) and their collectors and enthusiasts.

    There's types who buy to restore, but some want only with original body and motor. Some will only use original spare parts and panels where others will use newly made modern replica parts which can be much better value cost wise. Some want to spend their Super on an original untouched example, others will go for the top end concourse no cost spared restored things..more and more of these are restored into other models such as Sandman panel vans and "imitation" SLR 5000Toranas and GTHO Falcons.

    Timing and price mean all in collectible cars. They peak in popularity and apart from nostalgia and rarest/best examples tend to drop off as the fans of various icons of their life and time do the same. Anything before Commodores has value but peak price interest is now centred on 1970s V8 Toranas XA, XB and XC Falcons.

    These fans and the market is driven by their age and when they get lump sums of money (or old collectible cars) via inheritance or retirement. They decide to splash out on the vehicle they "always wanted" or "couldn't afford when new" or "My parents/grandparents had" and some will pay silly money even for a half rusted out "project" if it ticks their boxes.
    Best way to ruin collectible items is by not paying for professional tradesmen to do some or all areas of work to either save money or to enjoy the DIY aspects. Ripples from bad bogging, crap welding, incomplete rust removal, crap paint, stupid new mags with low profile tyres, upholstery etc cuts values of many restored jobs to less than their purchase and projects cost. If they get pros doing the work they get way better and long lasting results and a chance to end up with a valuable asset.

    Personally I still prefer detecting gold to playing amongst rust and decayed mouse remains for a hobby but there's still a huge market of people who disagree.
     
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