2009 Bull Market: +20% Real Return Ranks #12

The chart above shows annual, inflation-adjusted real returns for the Dow Jones Industrial Average (DJIA) over the last sixty years from 1950 to 2009 (data here and here). Some highlights:

1. The real return on the DJIA for 2009 was 20.62%, ranking #12 for annual returns over the last sixty years.

2. The 2009 return was the highest in five years, and the second highest over the last ten years behind the 23.02% real return in 2003.

3. The DJIA return in 2009 was almost 16% above the average real return over the last sixty years of 4.77%.

What makes the 2009 bull market even more interesting is that it seems to somewhat contradict all of the ongoing reports during 2009 about how we were in the "worst economy since ______" (fill in the blank) and many reports suggested we were almost on the verge of slipping into Great Depression II, etc.

Interestingly, if you do a Google search over the past year in the U.S., you'll find far more results for the term "2009 bear market" (11,800) than for "2009 bull market" (only 355); that's a bear to bull ratio of 33.2 to 1, despite the fact that 2009 obviously now qualifies as a bull market.

Likewise, the Google Trends chart below for the last year shows that the search volume for "bear market" in the United States was higher than the search volume for "bull market."

Bottom Line: The U.S. stock market performed better in 2009 than many people probably realize, and certainly better than most people expected - after all, a real return of more than 20% ranking 12th highest for the last 60 years is pretty good. And since stock markets and stock prices are forward-looking, 2010 might also be a much better year than many people are expecting.