Shocker: The S&P 500 is underperforming the stock market

Professor of Finance Hank Bessembinder evaluated lifetime returns to every U.S. common stock traded on the New York and American stock exchanges and the Nasdaq since 1926 to discover that only a small minority of companies provide all of the index’s excess return over cash each year.

Professor of Finance Hank Bessembinder evaluated lifetime returns to every U.S. common stock traded on the New York and American stock exchanges and the Nasdaq since 1926 to discover that only a small minority of companies provide all of the index’s excess return over cash each year.

In this article published June 27, 2019, on MarketWatch:

The best-performing 4% of listed companies explain the net gain for the entire U.S. stock market from 1926 through 2016.

– Hank Bessembinder, professor of finance and Francis J. and Mary B. Labriola Endowed Chair in Competitive Business