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Friday, September 28, 2012

Price Only Charts Don't Show the Full Picture

Tip of the hat to the great new Amazon money and investing blog. A post there(via motley fool) noted the importance of looking at total returns including dividends while almost all charts and news reports show price only.

The article presents this graph comparing price only with total return(dividends+ price change)
The article notes that in the "lost decade" for stocks from 2000 -2010 an actual investor in the S+P would have had a total return of 20%.

I ran charts for the period since Jan 2007 for growth of 100,000 in total return=+15.3%
But the price only chart below shows a negative return of close to 5% for that period


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