Post by roi2020 on Jun 25, 2023 6:26:03 GMT
Select excerpts listed below.
"Nearly 95% of all stocks in the 1940s and 1950s were owned by individual investors. They were mostly buy-and-hold investors, just looking to earn some dividends. More than 95% of all trading was done by individual investors. Today that number is more like 2% with 98% of trading being carried out by institutional investors and machines."
"The precipitous decline in fees can be traced back to both Vanguard and a change in rules instituted by the SEC back in 1975. That’s when the SEC abolished fixed-rate commissions for stock trading. Before then investors were paying an average of 1-3% to buy or sell a stock. So the costs didn’t scale even if the size of your trades went up. Plus the bid-ask spreads were wide enough to drive a truck through."
"During the 1980s, mutual fund assets jumped from $241 billion to $1.5 trillion. The charge was led by money market funds, which soared from $2 billion to $570 billion, accounting for almost half the increase."
"We went from 1% stock market ownership in 1929 to 19% in 1983 to nearly 60% by 2000. Almost 60% of households who owned stocks had purchased their first share after 1990. One-third of all buyers entered the market in 1995 or later."
"The S&P 500 lost around 10% in total during the first decade of the 21st century, a 10 year stretch that saw the market get chopped in half twice.
Things felt pretty bleak coming out of the Great Financial Crisis of 2008."
