On this page is a Dow Jones Industrial Average Historical Return Calculator.
Input time spans from 1 month to 60 years and 11 months for a summary of rolling returns over your choice of periods. Navigate to the ‘Chart’ tab for the graphed set of returns for your selections across all return quantiles.
The calculator also features a way to show individual period returns. If you select a month in the ‘Detailed Results for Periods Ending’ drop-down, the tool prints a detailed list of your selected time periods ending in that month.
The Dow Jones Industrial Average Historical Return Calculator
How to Use the Dow Jones Industrial Average Historical Return Calculator
The Dow Jones Industrial Average Historical Return Calculator has three essential and a number of optional inputs.
- Choose whether to take into consideration reinvested dividends as well as inflation (as measured by CPI).
- Select the time periods for the tool to compute summary statistics
- ‘Add More Periods’ will add another period entry
- On the entry, the ‘Remove’ button will delete the associated period
- Hit ‘Calculate Historical Returns’, then navigate between tabs to see data or the chart
Unless otherwise noted, all returns in the tool are annualized returns. Note the implication: spikes and drops in a single month will be amplified as if the trend continued for an entire year.
(Just be aware of the phenomenon. There was never a month that actually returned 11,000%.)
Inputs to the Dow Jones Industrial Average Historical Return Calculator
- Reinvest Dividends – By default, we model dividends paid and reinvested in simulated ‘shares’ of the Dow Jones. We do not attempt to model taxes, fees and other costs faced by a typical investor.
- Adjust for Inflation (CPI) – We use the CPI as our approximation for inflation. By default we turn inflation adjustment on, but if you would like to adjust returns using some other deflator just turn it off before exporting the data to another tool.
- Detailed Results for Periods Ending – If you select a month from the list, the tool will exhaustively list all periods in our data ending on that date.
Outputs from the Dow Jones Industrial Average Historical Return Calculator
- Using (CPI) Inflation Adjustment – Were these results inflation adjusted?
- Calculating Dividend Reinvestment – Do the calculated results factor in dividend reinvestment?
- Monthly Realized Historical Volatility – For month over month periods, we have calculated the historical volatility. (See here)
- Annual Realized Historical Volatility – Ditto for year over year results.
- Summary Statistics – The average, median, maximum and minimum return as well as the standard deviation of returns for all of your selected periods.
- Percentile Table – The quantile of returns for every period you selected. The return quoted is beaten by the percentage of rolling periods in the far left column.
- (Optional) Annualized Returns Ending… – If you selected a month in the Detailed Results pulldown, we will also show a table with exhaustive returns ending in the chosen month. This is most popular using ‘January’ as an ending month with periods such as 1, 5, 10, or 20 years.
Charting Results from the Dow Jones Industrial Average Historical Return Calculator
- The ordered sets take you from the 2nd percentile to the 98th percentile of returns 2 percent at a time
- The tool graphs all selected time periods on the same chart.
- To get around a hidden div quirk with Google Charts, the chart redraws each time you click the ‘Chart’ tab. (Beware if you are on mobile.)
Methodology for this calculator follows the Dow Jones Industrial Average dividend reinvestment calculator. When the underlying data updates there this tool will follow automatically.
Conclusions from the Dow Jones Industrial Average Historical Return Calculator
For all of the knocks in the financial press on price weighted indices, the market-cap weighted S&P 500 (see the S&P 500 version of the tool here) and the Dow Jones Industrial Average have performed similarly over the long term.
These deep dives in historical returns prove the old advice: the longer you wait, historically, the smoother your historical returns. A quick look at the graph shows that the historical return slope flattens as you increase the time frames.
On a practical level, money you need in the short term is best left out of equities. However, over a longer term 30-40 year career you’ll likely need to take some risks with your money exposed to the stock markets.
Do you see anything interesting in the results? Are you surprised that the Dow Jones Industrial Average and S&P 500 have such similar results in the long term?