Читать книгу Millionaire Expat - Andrew Hallam - Страница 12

Once upon a time, in a land far away, there lived a young farmer. His name was Luke Skywalker. Don't get confused by his Star Wars namesake. That was just a movie.

Luke had a farming mentor, an awkward little guy with a massive green thumb. His name was Yoda. “Use the Force you must, young Skywalker,” he said. “Add new seeds to your crop fields every year. The Force will grow those seeds. They will flower and spread more seeds and those seeds will grow.”

“Which seeds should I plant?” asked Luke. “Buy the bags that contain every type of seed for every type of vegetable,” replied Yoda. “You'll never know which vegetables will grow the best in any given year,” he said. “Plant them all, you should. Let the Force look after the rest. But watch out for the dark side.”

Luke wasn't sure what Yoda meant by the dark side. He just knew that Yoda was a mysterious little dude. So Luke bought a bag that contained every seed. He planted every one, and his crops began to flourish. Some years, his carrots grew best. Other years, his lettuce, parsnips, or beets took center stage. Sometimes, droughts and a searing sun hurt his crops. But his crops always came back, stronger than ever.

This is how the stock market works. You can buy a single fund called a global stock market index fund. Like a bag of seeds representing multiple plants, it contains thousands of different stocks, representing dozens of different markets. It contains American stocks, British stocks, Canadian stocks, Australian stocks, and Chinese stocks. In fact, a global stock market index contains about 7,400 stocks from at least 49 different countries. Nobody trades those stocks. With a global stock market index, you own all of those stocks. You would also have access to that money, any time you want.

Some years (much like the garden during a drought), the proceeds recede. But just like that garden, the stock market always comes back stronger than before.

Imagine if someone had invested a lump sum of $1,200 in the global stock market, starting in 1970. They then saved an additional $3.29 per day, adding that amount to their investment at the beginning of each year. Between January 1970 and December 31, 2020, that person would have added a total of $61,200 (see Figure 1.1 and Table 1.1). If they equaled the return of the global stock market index during those 51 years, that initial $1,200 investment—plus a further commitment equal to $3.29 per day—would have grown to more than $1.8 million. Between January 1970 and January 2021, global stocks averaged a compound annual return of 10.07 percent per year.

Figure 1.1 Global Stock Market Growth

SOURCE: Morningstar Direct.

Table 1.1 Global Stock Market Growth

Year Ended Dec 31	Annual Return	Total Cost of Cumulative Investments	Total Value after Growth
1970	−2.25%	$1,200	$1,173
1971	18.52%	$2,400	$2,812
1972	28.21%	$3,600	$5,144
1973	−8.96%	$4,800	$5,776
1974	−21.09%	$6,000	$5,505
1975	32.44%	$7,200	$8,880
1976	8.97%	$8,400	$10,984
1977	3.32%	$9,600	$12,588
1978	24.22%	$10,800	$17,128
1979	12.33%	$12,000	$20,588
1980	21.85%	$13,200	$26,548
1981	−3.19%	$14,400	$26,863
1982	6.61%	$15,600	$29,918
1983	25.37%	$16,800	$39,013
1984	6.47%	$18,000	$42,815
1985	51.83%	$19,200	$66,827
1986	45.35%	$20,400	$98,878
1987	10.06%	$21,600	$110,146
1988	20.56%	$22,800	$134,238
1989	24.15%	$24,000	$168,147
1990	−12.00%	$25,200	$149,025
1991	18.42%	$26,400	$177,897
1992	−4.10%	$27,600	$171,754
1993	25.25%	$28,800	$216,624
1994	6.19%	$30,000	$231,308
1995	20.73%	$31,200	$280,707
1996	13.73%	$32,400	$320,612
1997	15.33%	$33,600	$371,146
1998	27.58%	$34,800	$475,039
1999	29.04%	$36,000	$614,539
2000	−13.80%	$37,200	$530,767
2001	−17.86%	$38,400	$436,958
2002	−18.75%	$39,600	$356,003
2003	38.08%	$40,800	$493,226
2004	18.27%	$42,000	$584,758
2005	11.52%	$43,200	$653,460
2006	23.11%	$44,400	$805,953
2007	11.16%	$45,600	$897,231
2008	−41.72%	$46,800	$523,605
2009	30.40%	$48,000	$684,346
2010	8.62%	$49,200	$744,640
2011	−7.99%	$50,400	$686,248
2012	18.34%	$51,600	$813,526
2013	26.59%	$52,800	$1,031,361
2014	2.02%	$54,000	$1,053,419
2015	−0.44%	$55,200	$1,049,979
2016	6.53%	$56,400	$1,119,821
2017	−2.25%	$57,600	$1,394,068
2018	18.52%	$58,800	$1,258,000
2019	28.21%	$60,000	$1,595,348
2020	16.61%	$61,200	$1,895,913

SOURCE: Morningstar Direct.