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BrentinUtahsDixie wrote:
> The Lowest the Dow has been was 28 and that happened in the year that the
> Dow was created in 1896. So 28 is .0027 of 9354.71 the high in July. Also
> 334.1 times 28 is 9354.8. The Dow is 102 years old. Divide 9355 by 102 you
> get 91.71 which is .0098% per year. Or less than 1% per year. Asleep yet?
I don't get your reasoning here. You are dividing the high by the amount of
years - this doesn't tell us much. The reason you get the "less than one %
per year" is that you are dividing (whatever) by 102. If it was 100, say,
then the result would be 1% - meaning that each year represented 1% of the
total, where 100*1=100. <g>.
If you take a level of 28, 102 years ago, and compare it to the high, you end
up with an annualized return of 5.86%, even though the total growth is
33,410%, or 328% per year. Shows you the power of compounding.
Regards,
A.J.
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