Is a ten percent gain in the stock market a good increase?

Question

I invested $2000 in the stock market and made about $200. Would this gain be considered average? Good? Superb?

Thanks.

Answer 1

8 % is considered average return over a long period of time. In the short term there really is no average gain.

To determine how good it is. How many shares do you have or what price was the share when you got it. How long did you keep it. Before you say you gained 10% you have to subtract the amount it cost you to buy and sell the shares which will reduce the 200 dollars and then the capital gains taxes which are in effect on short term gains.

Any positive is Good though when dealing with stocks

Answer 2

Assuming you invested over a one year period, did not diversify (due to a lack of funds), and made $200 after commissions in the past years market (SP500 went up about 10%) your gain was about average.

However, a priori, I would guess that you didn't diversify which means that you took greater risks with individual stocks, instead of an investment in something like a SP500 index. That means that you made an average return but took on above average risk. Since investing is all about the returns you make on the risks you take, you underperformed.

Of course, I have no idea what you invested in so it's purely a guess (and probably a wrong one). At least you didn't lose money, but then again, in an up market, it is difficult to lose money.

Keep it up and if there's one thing I'd recommend, it is to READ, READ, READ! Investing is a zero-sum game, meaning that if you want to win, someone else has to lose. The best way to do that is to know more than your competition.

Good luck!

Answer 3

It kind of depends on how long it took you to earn that $200. If it took a month, that is superb. If you could do that month after month, then you'd more than double your money in about seven months!

If it took a year. That is pretty average in the long run. (9-12% is a normal return in the stock market).

If it took more than a year, then the longer it took, the less spectacular it was.

Hope that helps

Answer 4

Yes, it is a good gain!
If you leave your money in a mutual fund (that diviersifies with stock market and bonds, etc) and that has at least a 5% return and you do dividend reinvestment, your money doubles every 5 years.

Answer 5

10% in a week is great. 10% over 5 years is awful. It depends on how long it took.

Answer 6

Average , 300 % is better . . .
( but 300 is less common )

http://finance.yahoo.com/q/bc?s=RIMM&t=1y

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