Money For the Rest of Us

Episode 500: The S&P 500 Index and the Decade Ahead

Nov 6, 2024

In a milestone discussion, the hosts dive into the S&P 500 Index, celebrating its 267% return over the last decade. They explore how U.S. stocks have outperformed non-U.S. counterparts and predict a potential 3% return for the coming decade. The conversation shifts to economic forces like AI and geopolitical risks shaping the market's future. Reflection on past financial insights highlights different investment strategies and emphasizes community engagement, setting the stage for more enriching content ahead.

27:23

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Quick takeaways

The S&P 500 has shown remarkable growth with a cumulative return of 267% since 2014, driven by dominant technology sector contributions.

Analysts predict U.S. stocks may only achieve a 3% annual return over the next decade, raising concerns about valuation sustainability.

Deep dives

Performance of the S&P 500 Over Time

Since its inception, the S&P 500 has shown significant growth, achieving a cumulative return of 267% since May 2014, which translates to an annualized rate of 13.2%. This outperformance compared to non-U.S. stocks is notable, as the Vanguard Total International Stock ETF only returned 4.5% annually during the same period. Factors contributing to this success include the U.S. stock market's growth, which increased its share of the global stock market from 52% to 65% over the past decade. This substantial rise also highlighted shifts in sector contributions, with technology now dominating the market at 25%, reflecting its critical role in overall performance.

Intro

2min

The S&P 500: Performance Analysis and Future Projections

18min

Economic Forces and Market Projections for the Decade Ahead

8min

Reflecting on a Decade of Financial Insight and Community

2min

In the 500th episode of Money for the Rest of Us, we focus on the S&P 500 Index. How has the index changed, and why have U.S. stocks performed so well? Will U.S. stocks only return 3% in the next decade, as Goldman Sachs predicts.

We also discuss major themes covered on Money for the Rest of Us over 500 episodes and what are our plans for the future. Thanks for being a part of Money for the Rest of Us over the past decade.

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Show Notes

Select Sector Indices Consultation on Constituent Weightings Calculations – Results—S&P Global

What Does an Election Year Mean for the Market?—S&P Global

The Great Rotation: A potential unwinding of hyper-concentration in the US may favor balanced global portfolios by Brian Chingono—Verdad