3. Nine Decades of Real Asset Class Returns

Nothing stays the same forever!

After World War I, the U.S. stock market took on a more important role in everyday life. It also helped define a decade—“The Roaring Twenties”—and it played a principal role in what was the greatest economic crisis of the last century—“The Great Depression.” Equities provided the best returns in the 1920s, but there were investment alternatives. Like equities, the markets for those alternative investments expanded and gained depth as the nation shifted from an agrarian economy to an industrial one. During the transition, the ability and opportunity to invest grew.

This chapter looks at the returns of eight different asset classes by decade starting in 1920. The asset ...

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