Callan Periodic Table – Fascinating, But Useless?!

We had some new friends over for dinner on Saturday night and I, of course, got lots of questions about how we retired before we turned 50. The husband figured that I made some amazingly, lucky investment that paid out like we had won the lottery.

He asked what our special investing strategy was and I told him I pretty much just invest in S&P 500 Index Funds, which carry low management fees and generally beat most managed funds. He seemed surprised I wasn’t a day trader of some sort and I told him I don’t believe I am smart enough for that.

The conversation reminded me of the Callan Periodic Investment Table that I posted the most up-to-date version of above. It looks at different investment options and how they stack up year after year. I first saw a copy of this about 10 years ago. While I find it very interesting to look at, I’ve never drawn any useful insights from it!

I find the investment media is full of charts like these – they look useful (and are very precise) – but don’t really say anything about where the market is heading. (TIME magazine headlined this table “The One Investment Chart That Will Help You Retire Richer”). Really?!

In fact, the more I look at it, the less I feel like I know anything about how to allocate our nest egg. Investment options that do well, suddenly fall. Investments that do poorly suddenly rise. Or, neither of these things happen.

Why am I even sharing it here? I thought you all might also find it interesting (or at least colorful) and I am hoping someone will crack the code of what seems to be a random pattern! Anyone? πŸ˜‰

Table: Callan.com

10 thoughts on “Callan Periodic Table – Fascinating, But Useless?!

  1. It reminds me of a giant Scrabble board gone Blob — have you seen that movie?

    The more I read analyses the more confused I become. Like I know I should be reading Big ERNs posts on safe withdrawal and all that but I’m afraid I might have to kill myself. I guess that’s one way of not outliving my money.

    Liked by 1 person

    • Ha! Your quality of life in FIRE can definitely be reduced by worrying about too many investment factors. Ignorance – or at least simple investing – can be bliss!

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  2. Dear mr fire station and all of your friends. I will decode this chart for you and also tell you β€œthe one stock today that will be just like amazon!” If you will only invest in my newsletter for the paltry sum of $99.98 per month! It will more than pay for itself after your first trade!! Hahahaha. Love MP

    Liked by 1 person

    • With that degree of certainty, I’m sure this is a fantastic way for MrFireStation readers to beat the market, Michael! πŸ‘πŸ»

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  3. I agree it’s fascinating, not so sure it’s useless….I like is as great visual tool to demonstrate the benefits of diversification, and to remind me to check my asset allocation!

    Liked by 1 person

  4. Can’t add much value here…that random scrabble board only tells me simpler is better! I’m a pure low cost index fund and real estate investment kind-a-guy! I’d still be working, if I’d had to decipher that crazy graphic to actually know how to invest!

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    • Well put, Thom – we live in a world where we can track every breeze, but often miss the big picture.

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  5. I think the chart’s usefulness is in illustrating clearly that there is no best asset class to own and that the top and bottom performers will vary widely from one year to the next.

    It has no predictive value; it’s value is in demonstrating that there’s little point in making or relying on predictions when it comes to investing.

    Cheers!
    -PoF

    Liked by 1 person

    • Agree – “Past performance is no predictor of future success”. Good advice for investing, owning a sports car, or gambling at the casino! πŸ˜‰

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