10-Year Market Outlook

Because of the variability of stock market returns in the short run, I steer clients away from short-term tactical changes to their portfolio and prefer to rely on the weighty evidence of history, along with long-term thematic trends in the market. While no one has consistently and accurately predicted what the stock market is about to do, several well-respected firms provide long-term outlooks that have proven to be more accurate than short-term predictions.  

Below are their 2023 10-year estimates. 

If we put an equal weighting on all of these firms, the averages come out as follows -

It’s also notable that many of these firms had 10-year projections in 2010 that were substantially lower than what returns have actually been over the past 10 years. The economy grew into higher valuations. That could happen again. Or returns could be lower than anticipated. For planning purposes, I think it is prudent to adjust long-term return expectations so that there is a margin of safety in case returns are in fact lower than their long-term averages.  

Thank you for reading, 

Alex 

This blog post is not advice. Please read disclaimers.