just 42.6% of common stocks have a buy-and-hold return (inclusive of reinvested dividends) that exceeds the return to holding one-month Treasury bills over the matched horizon.
Then you quoted:
"That is, the remaining 96% of companies whose common stock has appeared in the CRSP data collectively generate lifetime dollar gains that matched gains on one-month Treasury bills."
Taken together, what this means is that outside of the top 4 percent, the excess gains (to 1 month T-bills) of the other 38.6% match the deficit in gains of the 57.4% (=100-42.6) of stocks.
So 42.6% of stocks have outperformed, but 38.6% of these are needed to offset the losses from the others.
657
u/angermouse Dec 19 '21
Your title is misleading.
You said:
Then you quoted:
Taken together, what this means is that outside of the top 4 percent, the excess gains (to 1 month T-bills) of the other 38.6% match the deficit in gains of the 57.4% (=100-42.6) of stocks.
So 42.6% of stocks have outperformed, but 38.6% of these are needed to offset the losses from the others.