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Friday, March 19, 2010

Which President Makes Me the Most Money - Great Question but the Wrong Question

I really enjoyed this recent article from Dave Ramsey about investment returns under various US Presidents. 

Here is a snapshot....

The truth is, investment success depends more on the resilience of the U.S. economy and your dedication to a long-term goal than on which candidate or party is in the White House.


Presidential Performance


For fun, let's say you made a hypothetical investment in the first year of each president's term. Ten years later, what kind of average annual return could you expect for investments made under the different administrations?

Good question. Let's start with President Bill Clinton. During his tenure, the economy experienced phenomenal growth, so you would expect a stellar average annual return. Ten years after Clinton took office, the S&P 500 was averaging 12.5% returns each year. Annual returns averaged 10.1% after his second term.


Now, let's look at President Jimmy Carter. His term saw the energy crisis and a tough recession—not the best and brightest of times. But the average annual return 10 years after he took office was16.4%, topping performance during Clinton's administration by several points.


The best 10-year average annual return occurred after President Ronald Reagan took office—17.4%. The worst was 4.8% after President Richard Nixon's first term.


Remember you can read the full article here.

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