Coming out of the depression, small stocks in the U.S. earned their highest one year historical
return of 143% in 1933. However, in the four years prior to that you would have lost (going from 1929
to 1932, in order) about 50%, 40%, 50%, and 5%. Suppose you started into this ﬁve year stretch with
$10,000 invested. How much did you still have heading into 1933? How much would you have at
the end of that year? Based on these numbers, do you think the 143% return should be included in
the return series?

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The Answer of Coming out of the depression, small stocks in the U.S. earned their highest one year historical
return of 143% in 1933. However, in the four years prior to that you would have lost (going from 1929
to 1932, in order) about 50%, 40%, 50%, and 5%. Suppose you started into this ﬁve year stretch with
$10,000 invested. How much did you still have heading into 1933? How much would you have at
the end of that year? Based on these numbers, do you think the 143% return should be included in
the return series?

Coming Out of the Depression, Small Stocks in the U