Ten & Five years of Sector Total Returns

After a month where all but two sectors (Consumer Staples and Health Care) have had double-digit returns, a look at longer term sector returns shows that investors will need a lot more months like March before even being able to think about getting back to even. The first chart below shows total returns for the S&P 500 and each of its ten sectors over the last five years. As one might expect, Financials are by far the biggest losers. With a decline of 62%, the decline in that sector is over two times the decline of the next closest sector (Consumer Discretionary). On the upside, even after the collapse in energy prices and energy stocks, the sector is still up nearly 70% over the last five years.

Looking at a ten-year window, overall returns are even worse as the S&P 500 has lost a total of 22.6%. Over that period, three sectors (Financials, Telecom Services, and Technology) are down nearly 50%, while only four are up. Returns like these hardly reinforce the idea that stocks are the best asset class to build long-term wealth, although with a track record this poor, can it get much worse?

Source:
Sector Total Returns
By Bespoke Investment Group
April 06, 2009 at 01:11 PM
http://bespokeinvest.typepad.com/bespoke/2009/04/sector-total-returns.html