The US, Sweden and Switzerland had the best performing stock markets 1900-2000.

As an unrelated aside, I once read a fairly serious paper which attempted to explain historical excess equity returns (the "equity premium puzzle") very simply: most analysis is done on the US market, but that doesn't take into account survivorship bias of stock markets themselves. Most stock markets that existed in the late 19th century have completely closed at some point, usually as a total loss for shareholders. By performing an analysis of one that survived (so far), the overall sample is very skewed to the positive. An interesting result that goes along with that is that the average valuation multiple of a given stock market is somewhat correlated with how long the stock market has been continuously operating: people are more willing to believe it will stick around.

Jim

Mechanical Investing FAQ

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