Presentation is loading. Please wait.

Presentation is loading. Please wait.

Copyright ©2005 Ibbotson Associates, Inc. Growth and Value Investing Securities offered through Lincoln Financial Advisors Corp., a broker/dealer, 1300.

Similar presentations


Presentation on theme: "Copyright ©2005 Ibbotson Associates, Inc. Growth and Value Investing Securities offered through Lincoln Financial Advisors Corp., a broker/dealer, 1300."— Presentation transcript:

1 Copyright ©2005 Ibbotson Associates, Inc. Growth and Value Investing Securities offered through Lincoln Financial Advisors Corp., a broker/dealer, 1300 S. Clinton Street, Fort Wayne, IN , Phone Insurance offered through Lincoln affiliates and other fine companies. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. CRN

2 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. What are growth and value stocks?  Growth stocks High growth rate of earnings, sales Low book-to-price, high price-to-earnings ratios Paying lower or no dividends  Risks Future growth does not occur as expected Book-to-price ratios rise unexpectedly, price-to- earnings ratios decline unexpectedly  Value stocks Slower growth of earnings and sales High book-to-price, low price-to-earnings ratios Higher dividend yields Turnaround opportunities  Risks Evaluation of stock as good value is misread Difficult to stick to value policy when prices are beaten down

3 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. Growth and value investing Ending wealth Average return Large value Large growth Hypothetical value of $1 invested at year-end Assumes reinvestment of income and no transaction costs or taxes. Year-end 1927–2004 $5,642 $859 $.10 $1 $10 $100 $1,000 $10,000 $100, % Small growth $1,1659.6% 9.2% 2004 Small value $43, %

4 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. Growth and value investing Average return Ending wealth Small growth Hypothetical value of $1 invested at year-end Assumes reinvestment of income and no transaction costs or taxes. Year-end 1994–2004 $2.39 Large growth $ % 9.1% $.9 $1 $6 $5 $4 $3 $2 Large value $ % Small value $ %

5 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. Growth and value stocks 1969–2004 Risk versus return Standard deviation Compound annual return Large growth Large value Small growth Small value Mid growth Mid value 3% 5% 7% 9% 11% 13% 15% 17% 15%17%19%21%23%25%27%29%

6 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. *Based on the years 1928–1929. **Based on the years 2000–2004. Compound annual rates of return by decade Growth and value by decade 2000s**1920s*1930s1940s1950s1960s1970s1980s1990s Growth stocks Value stocks -15% -10% -5% 0% 5% 10% 15% 20% 25%

7 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. One-year growth and value trends 1969–2004 Growth versus value stocks Data calculated using rolling 12-month returns. Annual premiums Large growth Large value 0% 10% 20% 30% 40%

8 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. Data calculated using rolling 36-month returns. Three-year growth and value trends 1969–2004 Growth versus value stocks Annual premiums Large growth Large value 0% 5% 10% 15% 20% 25%

9 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. 12-month excess returns relative to the S&P –2004 Excess returns Growth and value excess returns Large growth Large value -30% -20% -10% 0% 10% 20% 30%

10 This is for illustrative purposes only and not indicative of any investment. An investment cannot be made directly in an index. Past performance is no guarantee of future results. 3/1/2005 Copyright ©2005 Ibbotson Associates, Inc. Diversified portfolio represented by 50% growth stocks and 50% value stocks. Large value Large growth Year-end 1997–2004 Growth and value diversification benefits $1,213 $1,387 $700 $1,000 $1,300 $1,600 $1,900 $2, Diversified portfolio $1,315


Download ppt "Copyright ©2005 Ibbotson Associates, Inc. Growth and Value Investing Securities offered through Lincoln Financial Advisors Corp., a broker/dealer, 1300."

Similar presentations


Ads by Google