Goldman Sachs forecasts S&P 500 returns of just 3% over next decade -- depending on these stocks' gains

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Goldman’s tepid prediction comes during a particularly bullish market, with the S&P 500 amassing a 27% annual total return the last two years.

US stocks are unlikely to maintain their above-average performance over the next decade as investors plow into other assets, signaling an end to the S&P 500’s king-sized returns, Goldman Sachs Group strategists said Monday.

There is a 72% chance the S&P 500 Index will trail Treasury bonds and a 33% chance the stocks will lag inflation through 2034, the strategists said.“Investors should be prepared for equity returns during the next decade that are toward the lower end of their typical performance distribution,” the Goldman team wrote in a note.

Mahoney Asset Management CEO Ken Mahoney said he agrees the benchmark index will be due for a down year, but he does not think it will come so soon.

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