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Return on Investment for Various Assets

Return on investment has varied dramatically across asset classes.  Cumulative total return on investment of $1.00 in stocks have outperformed those for gold by over $480K in the 206 year period from 1802 to 2008! Similarly, stocks outperformed bonds by nearly 3% points per year which equates to $479K  over 206 years.  Below is a table on the compounded total return on $1.00 invested in various asset classed:

Total Real Return on Investment of $1 (1802-2008)

Asset Real Total Return Annual Growth Rate
Stocks $480,873 6.5%
Bonds $1,577 3.6%
Bills $306 2.8%
Gold $3 0.5%
Dollars <$0.10 -1.1%

Source: Common Sense on Mutual Funds, J. Bogle 2010

Using data from Irrational Exuberance (R. Shiller), the US real home price from 1890 to 2014 appreciated from $1.00 to $1.34, an annual compound growth rate of 0.25%.  While this is not over the same period of time, it is evident that homes have no real return on investment  over a long period, especially when considering the available alternatives.