The Outlook for Stock Returns

Although stock market returns are difficult to predict in the short term, historically stocks have delivered positive returns approximately three out of every four years*. Current U.S. stock market valuations are relatively high, suggesting lower forward-looking returns. While these valuations cannot be used to time the market in the short run, they do imply varying long-term expectations for different regions. For the broad U.S. stock market, our long-term return expectation (over the next 10 to 20 years) is around 8%. For developed international markets, our long-term return expectation is about 9%, with emerging markets projected to deliver returns of 11%–12%. Over the long term, stocks in any region are still expected to outperform cash and safe bonds, but short-term returns remain highly unpredictable. The market efficiently incorporates information that is currently known, but unexpected developments will likely emerge throughout 2025.

In our view, the best course of action is to stay disciplined to your long-term plan. Reach out to your advisor if you have any questions.

*S&P 500 from 1970-2023.

if you have any questions, please drop us a note.

For informational and educational purposes only and should not be construed as specific investment, accounting, legal or tax advice. Certain information is based upon third-party data, which may become outdated or otherwise superseded without notice. Third-party information is deemed to be reliable, but its accuracy and completeness cannot be guaranteed. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio nor do indices represent results of actual trading. Information from sources deemed reliable, but its accuracy cannot be guaranteed. Performance is historical and does not guarantee future results. Neither the Securities and Exchange Commission (SEC) nor any other federal or state agency have approved, determined the accuracy, or confirmed the adequacy of this article. Please be advised that Buckingham only shares video and content through our website, Facebook, LinkedIn page, and other official sources. We do not post investment advice on WhatsApp, Telegram, other interactive applications, or other similar platforms. Rather, Buckingham provides investment advice only through individualized interactions. R-24-8028.