«You can borrow possibly with only five percent down at approximately a four percent interest rate and buy a property that may generate at least a seven percent rate of
return annually, which greatly magnifies the
return on your
equity invested,» says Ailion.
On the contrary, since the 1940's, the ratio of equity market value to GDP has demonstrated a 90 % correlation with subsequent 10 - year total returns on the S&P 500 (see Investment, Speculation, Valuation, and Tinker Bell), and the present level is associated with projected annual total returns on the S&P 500 of just over 3 % annuall
On the contrary, since the 1940's, the ratio of
equity market value to GDP has demonstrated a 90 % correlation with subsequent 10 - year total
returns on the S&P 500 (see Investment, Speculation, Valuation, and Tinker Bell), and the present level is associated with projected annual total returns on the S&P 500 of just over 3 % annuall
on the S&P 500 (see Investment, Speculation, Valuation, and Tinker Bell), and the present level is associated with projected annual total
returns on the S&P 500 of just over 3 % annuall
on the S&P 500 of just over 3 %
annually.
A typical strategy might involve investing half of the portfolio in a dividend - paying, growth fund such as the T. Rowe Price
Equity Index 500 fund, which holds average risk and has
returned 7.19 %
annually on average through the 10 years ending July 1, 2016.