If so, that is about the average annual return you should plan on from your stock portfolio ex dividends, of course. This expansion should basically be over meaning stocks will have to rise in the future based strictly on advances in earnings . As a result, the road ahead will be a good deal bumpier, and returns will be far below those of recent years. You want a mix, because the groups go in and out of phase. Here s what Vanguard found when it recently examined the record of growth and value funds.
Value stocks don t always lag, as they have recently.
Longer-term results for the groups are similar. You want both a growth and value component. In my own portfolio, I own a mix and like to add to the group that is out of favor at any time in the cycle. And the fund has performed better than the average equity income fund over the period. Equity Income is a conservative fund run on a relative yield basis by Roger Newell and his capable daughter Jennifer.