The Long-Run Behavior of Stocks, Government Bonds, and Inflation in the U.S.

To properly guide their clients, financial advisors must have a good understanding of the long-run behavior of stock and bonds returns. A very useful and free data source for this analysis — and a great example of academic work that has great practical value — can be found at This organization put together 150+ years of annual stock, bond, and inflation data for 18 developed market economies.

Stock and bond returnsUsing this data set for the U.S. economy, we put together some summary statistics on stock-bond performance and inflation, grouped into 20-year subperiods.Explanation: The eq_tr, bond_tr, bill_rate, and cpi_yoy columns are the average equity return, government bond return, government bill return, and inflation (year-over-year CPI growth rates) level in each subperiod. The e_b_cor column shows the correlation of annual stock and government bond returns in each subperiod, and the cpi_vol column shows the year-over-year CPI growth rates. All underlying data are in annual terms.