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2015 S&P 500 Return

Written by:
PK

Although many sources will report that the S&P 500 returned -0.73% in 2015... if you include dividend reinvestment, the 2015 S&P 500 Return was actually 1.19%.

Including dividends is the difference between reporting a negative return and a positive one.

Dividend Reinvested Returns are Key!

As we point out every year, most financial publications will report a lower return on the S&P 500 than a buy & hold investor would actually experience.  Most stories leave out the effect of reinvesting dividends and distributions - the act of buying more shares of a security when that security returns money to shareholders.

Logically, this doesn't make much sense - even if investors aren't reinvesting dividends, they aren't using their dividend checks to heat their homes by throwing them in a fire - making an attempt to account for dividends is a necessityS&P Dow Jones Indices, the owner of the S&P 500, publishes an index called the "S&P 500 Total Return Index" specifically for this purpose.  The S&P TR reports how investors would have performed had they immediately reinvested dividends.

We maintain two calculators which do the math for you with monthly resolution:

The 2015 S&P 500 Return

You can find some historical data on the S&P 500 and the Total Return counterpart at Marketwatch.  Here's how the two indices look like on the same chart:
2015 S&P 500 Return: Price vs. Index

2015 S&P 500 Return: Price vs. Index

So there you have it - simply choosing how to report the index's returns made a massive difference this year, literally the difference between making and losing money.  Since the psychological difference of a loss with even a small gain is so great, we hope you'll agree with our assessment - you need to account for those dividend checks!

01/01/2015 Open12/31/2015 CloseAnnual Return
S&P 500 Total Return3776.493821.61.19%
S&P 500 Index2058.92043.94-0.73%

See other annual S&P 500 returns:

For those of your with a crystal ball or a need to answer some questions, chew these ones over:

  • Where will the S&P 500 go from here?
  • Are you a dividend reinvester?  A dividend spender?  A user of dividend checks to heat your home?

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