Recently, a seminar participant asked me why I always calculated with the average return. I swallowed hard. The average return in my calculation examples is set like the amen in church. If you look at the annual returns of the global MSCI World stock index over 25 years, you get “around” 8 percent. Strictly speaking, it is 8.1 percent, but since the calculation examples are meant to be simple and understandable, I speak of “around” 8 percent and “around” 6 percent after taxes. I never tire of saying that this is a past value and that what was says nothing, absolutely nothing, about the future. But we have to calculate with some values. The past is the most obvious, otherwise we might as well just roll the dice.
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