Sensex has provided positive returns in the Long Term….even better if you consider that alternative and much safer Investment avenues like Bank Fixed Deposits would have given a lower post tax return of below 7% pa
If you had remained invested till date from 1991,2001 or 2004 the CAGR is 13.5%,12% and 6.5% respectively
Interestingly if you had rode the Bull Run from 2001 or 2004 and dismounted earlier this year in January you would have got a marvellous CAGR of 27 % or 38 % for a Seven Year or Four Year Period respectively
I have taken the Opening Sensex levels in the Years 1991(Modern Reforms initiated ), 2001 (Turnaround Year after ICE meltdown in early 2000) and 2004 (beginning of a strong 4 year Bull run) and computed the Absolute and CAGR % returns over 18,17,8,7,5 and 4 years from these Opening levels to the High of 21207 reached earlier this year on January 10, 2008,to the intra day low of 7697 reached on October 27,2008 and the October 31,2008 closing of 9788
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From |
SENSEX RETURNS ABSOLUTE & CAGR |
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|
Year |
Opening Sensex |
High 21207 Jan 10,2008 |
Low 7697 Oct 27,2008 |
Current 9788 Oct 31,2008 |
|
1991 |
1027 |
17 years 1965 % 19.5 %
|
18 Years 649 % 12 % |
18 Years 853 % 13.5 % |
|
2001 |
3990 |
7 Years 432% 27 %
|
8 Years 93 % 8.5 % |
8 Years 145 % 12 % |
|
2004 |
5872 |
4 Years 261% 38 % |
5 Years 31 % 5.5 %
|
5 Years 67 % 6.5 % |