STI: -0.3% p.a. real return last 20 years?

stock-index

Experts’ insights for investors

I refer to the article “Experts’ insights for investors” (Sunday Times, May 14).

It states that “The benchmark Straits Times Index (STI), which has notched up half a century in its various incarnations, has turned in a better than expected performance this year.

STI up 13% so far this year

Fuelled by property and bank stocks, the STI has gained 13 per cent so far this year.

Mergers and acquisitions have also helped to boost its performance. On Friday, the STI closed at 3,255.29 points, down 15.82 points on the day.

Since the global financial crisis in 2008, the STI is up more than twofold

At the current level, the STI has rebounded 28.8 per cent from a low of 2,528 in February last year, but is still 8.3 per cent below the March 2015 high of 3,550. Since the global financial crisis in 2008, the STI has surged more than twofold, she said.

1.6% p.a. return from 2000 to now?

Looking at the historical performance chart – does it mean that the annualised return of the STI from 2000 to now, is about 1.6 per cent per annum?

-0.2% p.a. real return from 2000 to now?

Since inflation from 2000 (CPI 74.809) to 2016 (CPI 98.932) was about 1.8 per cent – does it mean that the real annualised return of the STI was about -0.2 per cent?

1.3% p.a. return from 1996 to now?

As to “FEB 6, 1996: The index hits a 2,493.71-point high” – does it mean that the annualised return of the STI from February 6, 1996 to now, is about 1.3 per cent per annum?

-0.3% p.a. real return from 1996 to now?

Since inflation from 1996 (CPI 72.53) to 2016 (CPI 98.932) was about 1.6 per cent – does it mean that the real annualised return of the STI was about -0.3 per cent?

Leong Sze Hian

About the Author

Leong
Leong Sze Hian has served as president of 4 professional bodies, honorary consul of 2 countries, an alumnus of Harvard University, authored 4 books, quoted over 1500 times in the media , has been a radio talkshow host, a newspaper daily columnist, Wharton Fellow, SEACeM Fellow, columnist for theonlinecitizen and Malaysiakini, executive producer of Ilo Ilo (40 international awards), invited to speak more than 200 times in over 30 countries, CIFA advisory board member, founding advisor to the Financial Planning Associations of Indonesia and Brunei. He has 3 Masters, 2 Bachelors degrees and 13 professional  qualifications.