Investor Presentaiton
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Calculating "Reasonable" Rate of Return
For the purposes of this study, we consider a "reasonable" market rate of return to be anything less than 4%. This rate is based on the 5-year nominal return of
3.8% on three-month treasury bills, all Canadian bonds, and the TSX Composite Index between 2015 and 2019.
In 2017 the reasonable rate of return, calculated based on the years 2012 to 2016 was also 4%.
5 year
'Nominal' Return
2015
2016
2017
2018
2019
average
Three-month T-bills
0.6%
0.5%
0.6%
1.3%
1.7%
0.9%
All Canadian Bonds
3.5%
1.7%
2.5%
1.4%
6.9%
3.2%
TSX Composite Index
-8.3%
21.1%
9.1%
-8.9%
22.9%
7.2%
Equal weighted average across asset classes
-1.4%
7.8%
4.1%
-2.1%
10.5%
3.8%
Source: BCSC
Note: Nominal is the stated return, while real is stated return minus inflation rate.
INNOVATIVE
RESEARCH GROUPView entire presentation