Research Institute Elroy Dimson, Paul Marsh, Mike Staunton Thought leadership from Credit Suisse and the world’s foremost expertsFebruary 2022Yearbook 2022 Summary Edition Credit Suisse Global Investment Returns
2Summary EditionExtracts from the Credit Suisse Global Investment Returns Yearbook 2022Important informationThis report contains extracts from the full 268-page Credit Suisse Global Investment Returns Yearbook 2022, which is available in hardcopy upon request – for details, see page 43. Coverage of 2022 Summary EditionThis Summary Edition contains three extracts from the full Credit Suisse Global Investment Returns Yearbook 2022. The first extract explains the Yearbook’s purpose. It describes the DMS Database, which lies at its core and covers all the main asset categories in 35 countries (including three new markets this year). Most of these markets, as well as the 90-country world index, have 122 years of data since 1900.The second extract addresses two current concerns, rising inflation and the prospect of interest rate rises to combat this. It summarizes the long-run evidence on inflation and shows how stocks and bonds have performed during different inflation regimes and during periods of interest rate hikes. The third extract reproduces in full the Yearbook’s new focus chapter on diversification. Finally, there are a selected number of sample “country pages” from the detailed statistical section of the full Yearbook. The text and charts in the Summary Edition are extracted directly from full Yearbook. The table and chart numbers in the Summary Edition are therefore not always sequential.Coverage of the full YearbookIn the full hardcopy 268-page Yearbook, renowned financial historians Professor Elroy Dimson, Professor Paul Marsh and Dr. Mike Staunton assess the returns and risks from investing in equities, bonds, cash, currencies and factors in 35 countries and in five different composite indexes since 1900. The Yearbook has nine chapters.Chapter 1 explains its purpose and coverage. It provides historical perspective on the evolution of equity and bond markets over the last 122 years, and the accompanying industrial transformation.Chapter 2 summarizes the long-run returns on stocks, bonds, bills, and inflation since 1900.Chapter 3 focuses on currencies, long-run exchange rate changes, purchasing power parity and the case for hedging.Chapter 4 looks at risk. It examines extreme periods of history, equity and bond drawdowns, and time-to-recovery. It presents worldwide data on the historical equity risk premium.Chapter 5 moves from historical to prospective returns. It shows how returns vary with the real interest rate and estimates the prospective equity premium. It provides estimates of expected stock and bond returns, comparing these with returns over recent decades. Chapter 6 presents evidence on factor investing around the world. It...
