Gains of 10%? You Gotta Be Kidding.
Unfortunately, we're still a long way from cheap.
No doubt about it, stocks and bonds have been hammered in recent weeks, and that's good news. As interest rates rise and shares prices fall, the outlook for long-run returns gets brighter and brighter. But let's not get too excited.
Even after the recent selloff, stocks are at 22 times trailing 12-month reported earnings and 10-year Treasury notes are yielding less than 5%. Yet many folks just aren't prepared for the low returns that these valuations imply.
According to the UBS Index of Investor Optimism, a joint effort of UBS and the Gallup Organization, investors are looking for their portfolios to clock a median 10% a year over the next 10 years. Make no mistake: A lot of these folks are going to be bitterly disappointed.
Yielding to Reality
True, nobody knows precisely how stocks and bonds will fare over the next decade. But you can make a reasonable estimate, and the answer isn't anywhere close to 10%.
So what should investors expect? With high-quality bonds, the best guide to your likely long-run return is the current yield.
For instance, if you buy a 10-year note yielding 5%, you know you will get 5% in interest every year and, at the end of the 10 years, you know you will get back the bond's principal value. The only uncertainty is what rate of interest you will earn as you reinvest the income from your bonds.
Yet, even though a return close to 5% is pretty much a sure thing, I don't think many folks buying 10-year notes today are really banking on earning 5% annually for the next decade.
"They are hoping to get out of these bonds and somehow magically get into something with a higher return and get that 10%," says Charles Farrell, a financial consultant in Medina, Ohio. "People are convinced they can trade their way to profits."
Trading may indeed work for some folks. But it can't work for everybody. Investors collectively earn the return delivered by the stock and bond-market averages. In fact, as a group, investors earn less than the markets, because of the investment costs they incur. Planning to trade your way to success? In all likelihood, the costs involved will wreak havoc with your returns.
Running the Numbers
While today's low bond yields offer a harsh reality check for overly optimistic investors, stocks leave plenty of room for self-delusion. You can always kid yourself that you will pick the next hot stock or the next hotshot fund manager, and thereby earn returns that are far better than the stock-market averages.
But absent that sort of extraordinary luck, the outlook is grim. As a stock investor, your gain comes from a mix of dividends and rising share prices. With dividend yields averaging less than 2%, we already know that part of the equation.
What about share-price appreciation? Historically, earnings per share have grown two percentage points a year faster than inflation. If annual inflation runs at 3%, we are talking about 5% earnings growth. Assuming share prices climb along with earnings, you will get 5% annual share-price gains. Tack on a little under 2% for dividends, and you are looking at almost 7% a year.
To be sure, there's a chance that earnings will grow faster than the historical average, so maybe we will get 8%.
But there is also a downside. We're assuming share prices climb along with earnings. What if they don't? "I don't think investors understand what it means for a stock or an entire market to trade at a price-earnings multiple of 22," Mr. Farrell says. "They just believe that stocks will basically go up in value, no matter how much they pay for them."
Suppose the price-earnings multiple on stocks drifts down over the next decade from today's 22 to the historical average of 15. That would knock four percentage points a year off the market's return, reducing our 7% annual return to just 3%.
Investing With Care
I am not predicting that stocks will clock 3% a year over the next decade. But I am pretty confident that investors won't enjoy the 10% gains they're expecting. Instead, if you own a mix of stocks and bonds, I figure you might earn 5% or 6% a year.
Such skimpy returns leave investors with precious little room for error. You can't afford to be lackadaisical about your monthly savings, because you need those savings to compensate for the markets' modest results.
To find out how much you should sock away each month, try playing with one of the savings calculators available on the Web, such as those at
www.bankrate.com and
www.choosetosave.org/.You also need to be careful about taxes and investments costs, which could put a big dent in your returns.
To that end, make the most of your employer's retirement plan and your individual retirement account, trade sparingly and favor no-load funds with rock-bottom annual expenses.
This greater care should extend to your portfolio's diversification. Forget betting heavily on one stock or one market sector. Sure, those big bets might pay off.
But there's also a risk you will be invested in the wrong place at the wrong time, thus missing out on the next big market move.
To ensure you capture whatever returns are available, I would spread your money widely, buying a mutual-fund mix that gives you exposure to bonds, large U.S. stocks, small U.S. companies and foreign shares.
"If you try to trade your way to higher profits, you may end up with worse results," Mr. Farrell warns. "You will probably be better off accepting that we're in a difficult environment and focusing on saving more, keeping your expenses low and paying attention to valuations."
想得到10%的收益率？别开玩笑了
无庸置疑，股市和债券市场最近几周遭受了重创，这是个不错的消息。随著利率的上升和股价的下跌，长期回报率的前景正变得日益诱人。但是不要高兴的太早。
即使是在近期的大跌之后，股市目前价格仍是过去12个月公司每股收益的22倍，10年期国债收益率在5%以下。但是许多人对可能获得低回报还没有做好准备。
根据瑞士银行(UBS)和盖洛普公司(Gallup Organization)合作开发的'瑞士银行投资者乐观指数'(UBS Index of Investor Optimism)，投资期望他们的投资组合在今后10年的年增长率中值为10%。别搞错：许多人将会败兴而归的。 屈从现实
的确，没有人能准确预计股市和债券市场在今后10年的表现。但是你还是可以作出一个合理的估计，但其结果与10%相差甚远。
投资者的期望值应该是多少呢？如果你拥有高质量债券，你最好依据当前收益率来预测你未来可能的长期收益率。
举例来说，如果你购买收益率为5%的10年期国债，你知道你每年都能获得5%的利息，而且10年后，你将会收回本金。唯一的不稳定因素是债券投资收益的再投资利率是多少。
不过即使你的收益率肯定在5%左右，我认为当前购买10年期国债的人中不会有很多人在今后10年每年真正能获得5%的收益。
俄亥俄州Medina的金融咨询师查尔斯?法瑞尔(Charles Farrell)说，"他们希望抛售这些债券，梦想著投身于回报率更高的投资，获得10%的收益。人们相信他们能够以自己的交易方式赚取利润。"
交易对某些人来讲的确是个生财之道。但并不是对所有人都百试不爽。投资者的股票和债券投资收益率总体来讲与市场平均水平一致。事实上，作为一个整体，投资者的收益低于市场，这是因为投资者投资需要耗费成本。打算通过自行交易取得成功？十有八九，交易所需成本将令你的投资收益全军覆没。
数字游戏
尽管当前债券的低收益率给过度乐观的投资者提了一个醒，但投资者在股市上总是会自欺欺人。你总以为自己能挑中下一只热门股，或者选中即将炙手可热的基金经理，因此赢得远高于股市平均水平的回报。
但是如果你没有这份好得离奇的运气，前景可不妙了。作为一个股市投资者，你的所得来自于股息和股价上涨。 股息的平均收益率低于2%，我们对此已经心知肚明。
那么股价上涨呢？从历史来看，每股收益年增长率比通货膨胀率高两个百分点。如果年通货膨胀率为3%，那么收益增长率则大约为5%。假设股价涨幅与收益率一致，你每年则将获得5%的股票上涨所得。假设股息收益率略低于2%，你每年将获得将近7%的回报。 当然，收益增速可能会高于历史平均水平，因此我们也许可以获得8%的收益率。
但是风险同样存在。我们在上面假设股价与收益涨幅一致，但如果不是这样的呢？法瑞尔说，"我想投资者并不明白22倍的本益比对一只股票或整个市场意味著什么。"他们只是相信不论他们以何种价位买进，股价都将会走高。"
假设今后10年股票本益比从当前的22倍降至历史平均水平15倍。这将令市场年回报率降低4个百分点，即年回报率从7%降至仅3%。
谨慎投资
我并不是说股票在今后10年每年的收益率为3%。但是我深信投资者不会取得预期的10%的回报率。相反，如果你同时拥有股票和债券，我认为你的年回报率也许会达到5%或6%。
如此微薄的回报水平意味著容不得投资者犯错。你不能再随意处置你每月的存款了，因为你需要为你在股市微薄的回报做好准备。
为弄清楚你每月应该储存的金钱额度，试著用网上的储蓄计算器来计算一下，比如
www.bankrate.com和
www.choosetosave.org的计算器。
你还需要审慎对待纳税和投资成本，因为你的投资回报可能会因此大打折扣。
在这一方面，尽量利用你雇主提供的退休计划和你的私人退休帐户；有节制的进行交易；选择没有佣金并且每年支出最少的基金。
另外，你应该给予投资组合多样性更多关注。别再想著将宝全押在一只股票或某一类股上面。当然，尽管这样的豪赌可能会获得丰厚回报。
但是还有一个风险是，你会在一个错误的时间进行了一笔错误的投资，从而错失下一波大牛市行情。
为了确保你抓住任何一个可能的机会，我建议你应该分散投资：购买含有债券投资的共同基金组合、大型美国股票、小型美国股票和外国股票。
法瑞尔警告说，"如果你试图以自己的方式交易以期获得更高利润，你可能只会得到一个更糟的结果。如果你正视当前的艰难环境，存更多的钱，降低支出并且关注价值，你的情况可能会更好些。"
