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Sensex Rolling Returns 15 Years

This document analyzes the yearly rolling returns of the BSE SENSEX index over various time periods from 1979 to 2008. It finds that: 1) The average yearly returns ranged from 18-20% across holding periods of 1 to 15 years, with the maximum return being 267% and minimum being -47%. 2) The probability of negative returns was highest for 1 year periods at 34% but declined to as low as 0% for 12 and 15 year periods. 3) Investing systematically through SIPs would have helped reduce even the negative returns by averaging out costs over time. In conclusion, given the average 18-20% returns over long periods of 10-15 years, there

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Siva Kalimuthu
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752 views2 pages

Sensex Rolling Returns 15 Years

This document analyzes the yearly rolling returns of the BSE SENSEX index over various time periods from 1979 to 2008. It finds that: 1) The average yearly returns ranged from 18-20% across holding periods of 1 to 15 years, with the maximum return being 267% and minimum being -47%. 2) The probability of negative returns was highest for 1 year periods at 34% but declined to as low as 0% for 12 and 15 year periods. 3) Investing systematically through SIPs would have helped reduce even the negative returns by averaging out costs over time. In conclusion, given the average 18-20% returns over long periods of 10-15 years, there

Uploaded by

Siva Kalimuthu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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BSE SENSEX Yearly Rolling Returns across different time periods

Any person invested or planning to invest in the equity markets in India needs to take
a long hard look at the following table and an even harder look at the summary of the
results below.
Date
31-Mar-79
28-Mar-80
31-Mar-81
31-Mar-82
31-Mar-83
30-Mar-84
28-Mar-85
31-Mar-86
31-Mar-87
30-Mar-88
31-Mar-89
30-Mar-90
27-Mar-91
31-Mar-92
31-Mar-93
31-Mar-94
31-Mar-95
29-Mar-96
31-Mar-97
31-Mar-98
31-Mar-99
31-Mar-00
30-Mar-01
28-Mar-02
31-Mar-03
31-Mar-04
31-Mar-05
31-Mar-06
30-Mar-07
31-Mar-08

Sensex
100
129
173
218
212
245
354
574
510
398
714
781
1,168
4,285
2,281
3,779
3,261
3,367
3,361
3,893
3,740
5,001
3,604
3,469
3,049
5,591
6,493
11,280
13,072
15,644

1 year

3 years

5 years

28.57
34.90
25.52
-2.85
15.99
44.24
62.24
-11.10
-21.94
79.13
9.45
49.54
266.88
-46.78
65.71
-13.71
3.24
-0.17
15.82
-3.92
33.73
-27.93
-3.75
-12.12
83.38
16.14
73.73
15.89
19.68

29.61
18.05
12.25
17.58
39.49
27.66
4.03
7.52
15.24
43.12
81.76
42.93
47.90
-8.70
13.86
-3.83
6.08
3.57
14.17
-2.53
-2.47
-15.21
15.76
23.23
54.67
32.73
34.06

19.66
22.44
27.05
18.58
13.50
23.81
17.16
15.26
53.04
41.76
39.57
33.09
23.58
-4.74
11.29
-0.21
8.93
1.37
0.64
-4.77
8.37
5.36
25.63
30.38
38.69

Returns (%)
7 years
10 years

28.36
21.77
12.61
18.48
20.52
24.97
42.80
21.78
33.11
35.03
24.81
23.18
18.77
-1.92
11.87
-0.67
0.89
-1.41
7.54
7.58
17.08
14.71
23.33

21.72
19.77
21.01
34.71
26.84
31.45
24.87
19.35
20.74
25.60
18.02
20.40
11.93
-2.09
2.95
3.99
7.13
12.85
14.55
14.92

12 years

15 years

22.73
33.94
23.95
26.85
25.60
24.39
20.63
17.29
18.05
23.47
14.45
13.23
8.32
2.24
9.11
9.54
12.27
13.66

27.40
24.05
21.86
20.02
21.43
19.92
19.31
13.03
13.63
14.53
14.71
15.16
16.32
7.72
13.70

The BSE Index started on 31-3-1979 at 100 points and on 31-3-2008 closed at 15644
points. Column two shows the closing value of the Sensex on 31st March each year.
Column 3 shows the gain/loss to any person who bought the Sensex in one year and sold
it 1 year later (holding period 1 year). Column 4 shows the results after holding the
investment for 3 years, Column 5 (holding period 5 years) and so on. The last column
shows the results if someone bought the Sensex in one year and held on for 15 years.

Summary since March 31, 1979

1 year

3
years

5
years

Time Period
7
10
years
years

12
years

15
years

Yearly Rolling Return


Observations

29

27

25

23

20

18

15

Negative Return Observations

10

34%

19%

12%

13%

5%

NIL

NIL

Average Return (%)

28

20

19

18

18

18

18

Max Return (%)

267

82

53

43

35

34

27

Minimum Return (%)

-47

-15

-5

-2

-2

Loss Probability

Past Performance of the SENSEX may or may not be sustained in future.


* Returns for the 1 year period are shown on absolute basis
** Returns for periods more than 1 year are shown on a compounded annualised basis

Remember this data is over a 30 year time period that has seen Wars,
Natural Calamities, Elections, Government Changes, Stock Markets Scams,
Terror Strikes and just about anything our country has faced and will be
facing in the future.
Is there anything to suggest that the next 30 years will be different from the
last 30 years?
Do go through the above table with a special dekho at Average return across
all time periods. This could help in your investment decisions.
If the average return on the Sensex has been 18% to 20% what stops me
from investing my long term money (3 years and more) in the Indian Equity
Markets?

Finally an investment through SYSTEMATIC


INVESTMENT PLAN (SIP would have reduced
even the negative returns that appear
www.michaelpduarte.com
18.07.2008

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