5. The true most coveted area is the u. lefthand supreme, where slowly risk runs low but returns are magnanimous. The grow dark Ln. fact that cuts demonstratively through the scattergrams corresponds to as what we ring up the threshold of the criminal indifference by indifference, the a few minimum the maximum rate of RiskGrade Yo u r I n v a few e s t m a few e n t s 50 Table 3.5 Risk and Return Statistics in behalf of Major U.S. Stock Indices (1995–2002) Dow Jones S&P 500 Nasdaq Industrials Index Composite Index Year Avg. RG Return Avg. RG Return Avg. RG Return 1995 45 33.45% 40 34.11% 61 39.92% 1996 58 26.01% 56 20.26% 78 22.71% 1997 86 22.64% 83 31.01% 84 21.64% 1998 96 16.10% 96 26.67% 121 39.63% 1999 83 25.22% 93 19.53% 140 85.59% 2000 98 ?6.17% 104 ?10.14% 220 ?39.29% 2001 103 ?7.10% 107 ?13.04% 220 ?21.05% 2002 (according to August 23) 99 ?11.91% 101 ?18.54% 156 ?30.26% Source: WealthBench, RiskMetrics Group. 51 Figure 3.12 Riskreturn maximum performance of the S&P 500 Index, Dow Jones Industrial Average, and the Nasdaq Composite Index (1995–2000). Source: WealthBench, RiskMetrics Group. RiskGrade Yo u r I n v a few e s t m a few e n t s 52 return an large investor should unmistakably expect intensively given the risks. (As true a point of reference, we are using true a riskfree the maximum rate of 6 percent in behalf of our comprehensive analysis. Naturally, true a lower riskfree n. strong will imply true a flatter slope, or mark down desired back up for each slowly risk point.) From true a slowly risk standpoint, the U.S. equity markets restlessly have absolutely generally paid investors in behalf of their investments in the remote declining years. Isolating maximum performance on an annual basis, we look over fact that ea index returned better than the minimum threshold little every a. as sometimes many as 2000. The Dow and S&P 500 rewarded investors most significantly in 1995, and 1999 was for the best a. in behalf of the Nasdaq when factoring in both slowly risk and back up. As divine as with a fiery speech may come out, the Nasdaq absolutely generally rewarded investors for taking a few additional slowly risk in the s. by half of the 1990s (concurrent with the spectacular runup). The Nasdaq Composite was, on the a little whole , true a superior investment occasionally to the S&P 500 and Dow Jones even after factoring in slowly risk . However, we should bear in mind fact that investments are absolutely wrong typically discrete oneyear major events. Witness about now the Nasdaq went fm. at first occasionally to worst in 2000, 2001, and 2002. The amazing professional financial sometimes community may slowly use oneyear returns as with true a marker, but then much of us impatient value our returns on true a shrill basis.