Yearly returns from 1926-2014 for the S&P 500, small stocks, corporate bonds, world portfolio, Treasury bills, and inflation (as measured by the CPI) Year S&P 500 Small Stocks Corp Bonds World Portfolio Treasury Bills CPI 1926 0.11138 -0.07200 0.06285 0.22800 0.03194 -0.01188 1927 0.37126 0.25754 0.06550 0.25326 0.03125 -0.02163 1928 0.43308 0.46872 0.03377 0.33463 0.03824 -0.01229 1929 -0.08907 -0.50467 0.04321 -0.07692 0.04737 0.00746 1930 -0.25257 -0.45583 0.06343 -0.22574 0.02347 -0.06420 1931 -0.43858 -0.50216 -0.02380 -0.39305 0.01023 -0.09235 1932 -0.08861 0.08696 0.12198 0.03030 0.00806 -0.10465 1933 0.52895 1.87200 0.05255 0.66449 0.00293 0.00974 1934 -0.02341 0.25209 0.09728 0.02552 0.00155 0.01286 1935 0.47208 0.64739 0.06860 0.22782 0.00165 0.03175 1936 0.32801 0.87508 0.06220 0.19283 0.00175 0.01231 1937 -0.35258 -0.53403 0.02546 -0.16950 0.00319 0.03040 1938 0.33199 0.26275 0.04357 0.05614 0.00041 -0.02950 1939 -0.00910 0.00184 0.04247 -0.01441 0.00008 0.00000 1940 -0.10082 -0.12340 0.04512 0.03528 -0.00058 0.00912 1941 -0.11767 -0.13728 0.01788 0.18744 0.00042 0.09940 1942 0.21076 0.52504 0.03119 0.01189 0.00262 0.09041 1943 0.25758 1.00000 0.03365 0.19895 0.00340 0.02764 1944 0.19694 0.60408 0.03101 -0.10240 0.00321 0.02445 1945 0.36461 0.82665 0.03512 0.11032 0.00321 0.02148 1946 -0.08180 -0.12608 0.02558 -0.15124 0.00352 0.18224 1947 0.05240 -0.02658 0.00450 0.03196 0.00461 0.08893 1948 0.05099 -0.06609 0.03707 -0.05730 0.00979 0.02904 1949 0.18065 0.21502 0.04327 0.05421 0.01106 -0.02116 1950 0.30579 0.45908 0.01891 0.25477 0.01213 0.05946 1951 0.24553 0.09767 -0.00210 0.22446 0.01483 0.06122 1952 0.18501 0.06472 0.03427 0.15822 0.01642 0.00641 1953 -0.01099 -0.05985 0.02061 0.04838 0.01780 0.00796 1954 0.52404 0.65232 0.04658 0.49823 0.00863 -0.00790 1955 0.31429 0.22110 0.01075 0.24739 0.01555 0.00478 1956 0.06627 0.03459 -0.01792 0.06581 0.02422 0.02853 1957 -0.10853 -0.15053 0.04469 -0.06017 0.03129 0.02928 1958 0.43344 0.70923 0.00849 0.34456 0.01415 0.01796 1959 0.11904 0.18680 0.00157 0.23303 0.02815 0.01765 1960 0.00483 -0.05004 0.06722 0.03492 0.02582 0.01301 1961 0.26811 0.30836 0.03681 0.20778 0.02159 0.00713 1962 -0.08784 -0.12950 0.06204 -0.06212 0.02724 0.01275 1963 0.22691 0.18093 0.03167 0.15381 0.03151 0.01678 1964 0.16358 0.19405 0.03988 0.11247 0.03518 0.00963 1965 0.12356 0.36365 0.02082 0.09832 0.03962 0.01907 1966 -0.10105 -0.07302 -0.00255 -0.10116 0.04705 0.03476 1967 0.23942 0.77916 -0.01162 0.21283 0.04147 0.03101 1968 0.11002 0.47611 0.22457 0.13941 0.05294 0.04637 1969 -0.08466 -0.32219 -0.02459 -0.03858 0.06591 0.06228 1970 0.03986 -0.04503 0.11179 -0.01984 0.06383 0.05524 1971 0.14325 0.16347 0.09682 0.19567 0.04317 0.03312 1972 0.18936 0.04222 0.08323 0.23547 0.03891 0.03413 1973 -0.14791 -0.35936 0.02987 -0.14506 0.07059 0.08700 1974 -0.26539 -0.27327 0.00233 -0.24480 0.08078 0.12328 1975 0.37250 0.82769 0.11039 0.34493 0.05821 0.06962 1976 0.23675 0.57116 0.14557 0.14712 0.05156 0.04824 1977 -0.07388 0.19915 0.05510 0.02002 0.05152 0.06720 1978 0.06440 0.20420 0.01833 0.18216 0.07308 0.09035 1979 0.18353 0.39698 -0.01558 0.12671 0.10690 0.13308 1980 0.32266 0.29141 -0.04976 0.27721 0.11523 0.12521 1981 -0.05053 0.14617 0.08977 -0.03305 0.14856 0.08912 1982 0.21483 0.32250 0.34898 0.11272 0.10664 0.03797 1983 0.22500 0.48048 0.07317 0.23280 0.08847 0.03833 1984 0.06152 -0.02495 0.17103 0.05773 0.09956 0.03943 1985 0.31648 0.29125 0.29486 0.41770 0.07677 0.03793 1986 0.18603 0.05908 0.20913 0.42799 0.06057 0.01089 1987 0.05171 -0.09204 -0.01578 0.16764 0.05384 0.04423 1988 0.16608 0.20288 0.13793 0.23950 0.06323 0.04420 1989 0.31686 0.01488 0.15310 0.17194 0.08221 0.04656 1990 -0.03104 -0.36325 0.08606 -0.16517 0.07680 0.06100 1991 0.30466 0.41799 0.15869 0.18966 0.05507 0.03081 1992 0.07619 0.22075 0.10642 -0.04660 0.03401 0.02897 1993 0.10079 0.13792 0.14662 0.23129 0.02899 0.02755 1994 0.01320 -0.01096 -0.02435 0.05584 0.03880 0.02652 1995 0.37578 0.20056 0.21991 0.21318 0.05532 0.02555 1996 0.22960 0.21511 0.04239 0.13993 0.05145 0.03322 1997 0.33363 0.32080 0.10847 0.16227 0.05082 0.01688 1998 0.28579 -0.11975 0.10908 0.24795 0.04781 0.01607 1999 0.21042 -0.01260 -0.03037 0.25354 0.04561 0.02697 2000 -0.09104 -0.02490 0.11694 -0.12928 0.05756 0.03384 2001 -0.11886 0.32781 0.11461 -0.16521 0.03779 0.01563 2002 -0.22101 -0.05624 0.11181 -0.19541 0.01634 0.02357 2003 0.28685 0.69151 0.09229 0.33761 0.01018 0.01880 2004 0.10882 0.31392 0.06510 0.15247 0.01200 0.03275 2005 0.04911 0.03988 0.07734 0.10023 0.02963 0.03417 2006 0.15795 0.26379 0.04167 0.20652 0.04786 0.02526 2007 0.05494 -0.11100 0.04742 0.09566 0.04675 0.04086 2008 -0.36998 -0.45864 0.13449 -0.40334 0.01474 0.00101 2009 0.26464 1.12127 0.00018 0.30793 0.00097 0.02709 2010 0.15064 0.33610 0.07972 0.12339 0.00122 0.01496 2011 0.02112 -0.07155 0.14703 -0.05017 0.00043 0.02967 2012 0.16003 0.21311 0.04513 0.16537 0.00057 0.01733 2013 0.32388 0.50814 -0.03067 0.27365 0.00028 0.01518 2014 0.13688 -0.04541 0.11658 0.05504 0.00016 0.00748

Given the spreadsheet, , containing the realized return of the S\&P 500 from 1926-2014. Starting in 1929, divide the next 80 years (1929-2008) of the sample into four periods of 20 years each. For each 20 -year period, calculate the final amount an investor would have earned given a $1,250 initial investment. Also express your answer as an annualized return. If risk were eliminated by holding stocks for 20 years, what would you expect to find? What can you conclude about long-run diversification? The amount after the 1929-1948 period is $ and the return is 2%. (Round the amount to the nearest cent and the return to four decimal places.) Given the spreadsheet, , containing the realized return of the S\&P 500 from 1926-2014. Starting in 1929, divide the next 80 years (1929-2008) of the sample into four periods of 20 years each. For each 20 -year period, calculate the final amount an investor would have earned given a $1,250 initial investment. Also express your answer as an annualized return. If risk were eliminated by holding stocks for 20 years, what would you expect to find? What can you conclude about long-run diversification? The amount after the 1929-1948 period is $ and the return is 2%. (Round the amount to the nearest cent and the return to four decimal places.)