What Can You Learn From Historical Stock Quotes?


Quick Answer

Historical stock quotes provide information that can be used to guide investor choices, according to the Financial Times. However, historic stock quotes or information about the performance of any asset class cannot predict which asset class will perform well, according to MarketWatch.

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Full Answer

Historical data about stock performance show that, more often than not, the equity market has been profitable to long-term investors and that stock performance in the 1980s was better than it was in the 1990s, according to MarketWatch. Adding stocks to a predominantly bond-heavy portfolio can increase the risk and the returns of the portfolio, according to the American Association of Individual Investors.

A review of annualized return on stocks from 1939 through 2013 published by investment firm Dimensional Fund Advisors indicates that small-cap value stocks outperformed all other stock types except during the great depression of the 1930s, according to MarketWatch. CNN Money reports that stocks remain the best performing asset class in the history of the United States market while exhibiting unprecedented short-term volatility.

An analysis of historical stock quotes can also reveal the relationship between risk and returns when stock is added to a portfolio. The addition of stock may dramatically increase returns, but slowly adds medium-term risk, according to the American Association of Individual Investors.

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