If you invested $100 in the S&P 500 at the beginning of 1965, you would have about $117.12 at the end of 1974, assuming you reinvested all dividends. This is a return on investment of 17.12%, or 1.59% per year.
This lump-sum investment does not beat inflation during this period, for an inflation-adjusted return of -25.17% cumulatively, or -2.86% per year.
If you used dollar-cost averaging (monthly) instead of a lump-sum investment, you'd have $112.99.
The graph below shows the performance of $100 over time if invested in an S&P 500 index fund. The returns assume that all dividends are automatically reinvested.
The nominal return on investment of $100 is $17.12, or 17.12%. This means by 1974 you would have $117.12 in your pocket.
However, it's important to take into account the effect of inflation when considering an investment and especially a long-term investment. You can convert S&P returns to their real (inflation-adjusted) value using an inflation calculation based on the U.S. Bureau of Labor Statistics Consumer Price Index (CPI).
In the case of the returns described above, the CPI in 1965 was 31.500 and the CPI in 1974 was 49.300.
The ratio between these CPIs describes how relative buying power of a dollar has changed over 9 years.
Adjusted for inflation, the $117.12 nominal end value of the original $100 investment would have a real return of roughly $-25.17 in 1965 dollars. This means the inflation-adjusted return is -25.17% as opposed to the original 17.12%.
The table below shows the full dataset pertaining to a $100 investment, including gains and losses over the 120-month period between 1965 and 1974.
Note that data shown is the monthly average closing price. Returns include dividends.
Year
Month
Return (%)
Amount ($)
CPI
1965
1
0.98%
100.98
31.20
1965
2
0.34%
101.31
31.20
1965
3
1.56%
102.89
31.30
1965
4
1.73%
104.67
31.40
1965
5
-4.51%
99.96
31.40
1965
6
0.10%
100.06
31.60
1965
7
2.12%
102.18
31.60
1965
8
3.60%
105.85
31.60
1965
9
2.50%
108.50
31.60
1965
10
1.08%
109.66
31.70
1965
11
-0.21%
109.43
31.70
1965
12
1.98%
111.60
31.80
1966
1
-0.43%
111.12
31.80
1966
2
-3.86%
106.83
32.00
1966
3
3.32%
110.37
32.10
1966
4
-5.01%
104.85
32.30
1966
5
-0.56%
104.26
32.30
1966
6
0.02%
104.28
32.40
1966
7
-5.77%
98.26
32.50
1966
8
-3.22%
95.10
32.70
1966
9
-0.56%
94.56
32.70
1966
10
5.32%
99.59
32.90
1966
11
0.72%
100.30
32.90
1966
12
4.13%
104.44
32.90
1967
1
3.73%
108.34
32.90
1967
2
2.63%
111.19
32.90
1967
3
1.99%
113.40
33.00
1967
4
2.06%
115.74
33.10
1967
5
-0.99%
114.59
33.20
1967
6
1.99%
116.87
33.30
1967
7
1.85%
119.04
33.40
1967
8
1.65%
121.01
33.50
1967
9
0.10%
121.12
33.60
1967
10
-2.88%
117.63
33.70
1967
11
3.11%
121.29
33.80
1967
12
-0.02%
121.27
33.90
1968
1
-4.26%
116.11
34.10
1968
2
-1.56%
114.30
34.20
1968
3
7.66%
123.06
34.30
1968
4
2.56%
126.20
34.40
1968
5
2.94%
129.92
34.50
1968
6
0.05%
129.98
34.70
1968
7
-1.93%
127.47
34.90
1968
8
3.51%
131.94
35.00
1968
9
2.72%
135.52
35.10
1968
10
1.79%
137.94
35.30
1968
11
1.29%
139.72
35.40
1968
12
-3.99%
134.15
35.50
1969
1
-0.24%
133.83
35.60
1969
2
-1.91%
131.27
35.80
1969
3
2.27%
134.25
36.10
1969
4
3.51%
138.97
36.30
1969
5
-4.97%
132.06
36.40
1969
6
-4.21%
126.51
36.60
1969
7
-0.28%
126.15
36.80
1969
8
0.63%
126.94
37.00
1969
9
1.35%
128.65
37.10
1969
10
1.00%
129.93
37.30
1969
11
-5.03%
123.40
37.50
1969
12
-0.59%
122.67
37.70
1970
1
-3.20%
118.75
37.80
1970
2
2.01%
121.14
38.00
1970
3
-2.75%
117.81
38.20
1970
4
-11.20%
104.62
38.50
1970
5
-0.27%
104.34
38.60
1970
6
0.52%
104.88
38.80
1970
7
3.26%
108.30
39.00
1970
8
6.32%
115.14
39.00
1970
9
2.49%
118.01
39.20
1970
10
0.21%
118.25
39.40
1970
11
7.16%
126.72
39.60
1970
12
4.11%
131.93
39.80
1971
1
4.15%
137.40
39.80
1971
2
2.83%
141.30
39.90
1971
3
3.67%
146.49
40.00
1971
4
-1.11%
144.86
40.10
1971
5
-1.60%
142.55
40.30
1971
6
-0.46%
141.89
40.60
1971
7
-1.52%
139.74
40.70
1971
8
2.49%
143.21
40.80
1971
9
-1.86%
140.54
40.80
1971
10
-4.37%
134.40
40.90
1971
11
7.16%
144.03
40.90
1971
12
4.42%
150.40
41.10
1972
1
2.09%
153.54
41.10
1972
2
2.62%
157.56
41.30
1972
3
1.26%
159.54
41.40
1972
4
-0.78%
158.30
41.50
1972
5
0.52%
159.12
41.60
1972
6
-0.50%
158.32
41.70
1972
7
3.78%
164.31
41.90
1972
8
-1.21%
162.32
42.00
1972
9
0.42%
163.00
42.10
1972
10
5.25%
171.56
42.30
1972
11
2.31%
175.53
42.40
1972
12
0.99%
177.27
42.50
1973
1
-3.33%
171.37
42.60
1973
2
-1.35%
169.07
42.90
1973
3
-1.63%
166.30
43.30
1973
4
-2.57%
162.03
43.60
1973
5
-1.99%
158.81
43.90
1973
6
1.21%
160.73
44.20
1973
7
-1.64%
158.10
44.30
1973
8
2.00%
161.25
45.10
1973
9
4.24%
168.08
45.20
1973
10
-6.85%
156.57
45.60
1973
11
-6.81%
145.91
45.90
1973
12
1.70%
148.39
46.20
1974
1
-2.47%
144.72
46.60
1974
2
4.57%
151.34
47.20
1974
3
-4.82%
144.05
47.80
1974
4
-2.71%
140.16
48.00
1974
5
0.46%
140.80
48.60
1974
6
-11.35%
124.82
49.00
1974
7
-3.76%
120.12
49.40
1974
8
-10.01%
108.09
50.00
1974
9
2.38%
110.66
50.60
1974
10
3.74%
114.80
51.10
1974
11
-6.09%
107.81
51.50
1974
12
8.63%
117.12
51.90
Click to show 102 more rows
Remember, returns are based on the average closing price across the entire month. Some losses are offset by dividend returns.
Dollar-cost averaging
Dollar-cost averaging is an alternative to investing the full lump-sum of $100.00 up-front. Instead, the capital is invested over a period of time.
Consider a strategy in which $100.00 was invested in the S&P 500 over a period of no more than 24 months beginning in 1965. This would result in a final amount of $112.99, including dividend reinvestments. In this particular case, dollar-cost average returns are less than the returns of a lump-sum investment (which ends with $117.12).
Year
Month
Contribution ($)
Amount ($)
1965
1
4.16
4.19
1965
2
4.16
8.37
1965
3
4.16
12.71
1965
4
4.16
17.16
1965
5
4.16
20.34
1965
6
4.16
24.52
1965
7
4.16
29.28
1965
8
4.16
34.63
1965
9
4.16
39.75
1965
10
4.16
44.37
1965
11
4.16
48.42
1965
12
4.16
53.61
1966
1
4.16
57.51
1966
2
4.16
59.28
1966
3
4.16
65.53
1966
4
4.16
66.19
1966
5
4.16
69.95
1966
6
4.16
74.11
1966
7
4.16
73.74
1966
8
4.16
75.38
1966
9
4.16
79.07
1966
10
4.16
87.65
1966
11
4.16
92.45
1966
12
4.32
100.76
1967
1
-
104.51
1967
2
-
107.27
1967
3
-
109.40
1967
4
-
111.65
1967
5
-
110.55
1967
6
-
112.75
1967
7
-
114.84
1967
8
-
116.74
1967
9
-
116.85
1967
10
-
113.48
1967
11
-
117.01
1967
12
-
116.99
1968
1
-
112.01
1968
2
-
110.27
1968
3
-
118.72
1968
4
-
121.75
1968
5
-
125.33
1968
6
-
125.39
1968
7
-
122.97
1968
8
-
127.28
1968
9
-
130.74
1968
10
-
133.08
1968
11
-
134.79
1968
12
-
129.41
1969
1
-
129.11
1969
2
-
126.63
1969
3
-
129.51
1969
4
-
134.07
1969
5
-
127.40
1969
6
-
122.04
1969
7
-
121.70
1969
8
-
122.46
1969
9
-
124.11
1969
10
-
125.35
1969
11
-
119.05
1969
12
-
118.35
1970
1
-
114.56
1970
2
-
116.87
1970
3
-
113.66
1970
4
-
100.93
1970
5
-
100.66
1970
6
-
101.18
1970
7
-
104.48
1970
8
-
111.08
1970
9
-
113.85
1970
10
-
114.08
1970
11
-
122.25
1970
12
-
127.27
1971
1
-
132.56
1971
2
-
136.31
1971
3
-
141.32
1971
4
-
139.75
1971
5
-
137.52
1971
6
-
136.89
1971
7
-
134.81
1971
8
-
138.16
1971
9
-
135.59
1971
10
-
129.66
1971
11
-
138.95
1971
12
-
145.09
1972
1
-
148.12
1972
2
-
152.00
1972
3
-
153.91
1972
4
-
152.72
1972
5
-
153.51
1972
6
-
152.73
1972
7
-
158.51
1972
8
-
156.59
1972
9
-
157.25
1972
10
-
165.51
1972
11
-
169.34
1972
12
-
171.01
1973
1
-
165.32
1973
2
-
163.10
1973
3
-
160.44
1973
4
-
156.31
1973
5
-
153.20
1973
6
-
155.06
1973
7
-
152.52
1973
8
-
155.57
1973
9
-
162.15
1973
10
-
151.04
1973
11
-
140.76
1973
12
-
143.16
1974
1
-
139.62
1974
2
-
146.00
1974
3
-
138.97
1974
4
-
135.21
1974
5
-
135.83
1974
6
-
120.42
1974
7
-
115.88
1974
8
-
104.28
1974
9
-
106.76
1974
10
-
110.75
1974
11
-
104.01
1974
12
-
112.99
Click to show 102 more rows
Data Sources
The information on this page is derived from Robert Shiller's book, Irrational Exuberance and the accompanying dataset, as well as the U.S. Bureau of Labor Statistics' monthly CPI logs.
Note that S&P index value for the current quarter is based on a moving average of closing prices, per Robert Shiller's methodology. The inflation data used is based on annual CPI averages.
About the author
Ian Webster is an engineer and data expert based in San Mateo, California. He has worked for Google, NASA, and consulted for governments around the world on data pipelines and data analysis. Disappointed by the lack of clear resources on the impacts of inflation on economic indicators, Ian believes this website serves as a valuable public tool. Ian earned his degree in Computer Science from Dartmouth College.
