, 11.6 per cent on an average annual basis over the past three years, 11.5 per cent over the past five years and 15.2 per cent over the past 10 years. Those are Canadian-dollar total returns, which include dividends.
The S&P/TSX composite is up 8.4 per cent in the past 12 months, an average annual 10.3 per cent in the past three, 7.8 per cent in the past five and 8 per cent in the past 10 years. For context,for financial planners to use in their work set 6.2 per cent as a realistic long-term expectation for Canadian stocks and 6.5 per cent for foreign developed markets like the United States.
Hot stocks may seem like a storyline for the fortunate few at the top of the income scale. But, actually, a huge swathe of the population benefits. Gen Zs and millennials can benefit from strong stock market returns in their First Home Savings Accounts. Gen Xers are in their prime retirement saving years - hot stocks help drive good results.
Boomers and seniors have the most wealth already, but also the greatest need for that money in funding retirement income. Strong stock markets help keep retirement portfolios growing, even as money is withdrawn. Stocks will tank at some point - that’s a done deal, and a buying opportunity. If nothing else, the current boom time for stocks shows us how resilient they are as a way to build wealth.