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The Global Investment Returns Yearbook leverages 125 years of historical data to provide unparalleled insights to help investors navigate today’s market issues. In light of rising market concentration and correlations, this year’s Yearbook includes a special chapter on global and multiasset diversification.
Launched by UBS Investment Bank and UBS Global Wealth Management’s Chief Investment Office in partnership with Professor Paul Marsh and Dr. Mike Staunton of London Business School and Professor Elroy Dimson of Cambridge University, this year's edition of the Global Investment Returns Yearbook explores how 125 years of historical data can provide insights for the future.
Some notable observations from the 2025 edition include the following:
Markets have changed dramatically. Of the US firms listed in 1900, ~80% of their value was in industries that are small or extinct today; the UK figure is 65%. Additionally, a high proportion of today’s listed companies come from industries that were small or non-existent in 1900: 63% by value for the US and 44% for the UK.
The long-run outperformance of stocks has been striking. Equities have outperformed bonds, bills and inflation in every country. An initial investment of USD 1 in US equities in 1900 grew to USD 107,409 in nominal terms by end-2024.
Concentration is a growing issue. Despite a relatively balanced global equity market in 1900, the US now accounts for 64% of world capitalization, largely due to the outperformance of major technology stocks. Market concentration in the US is the highest it has been in 92 years.
Diversification has helped manage volatility. While globalization has increased the extent to which markets move together, the potential risk reduction benefits from international diversification remain large. For developed market investors, emerging markets continue to offer better diversification prospects than other developed markets.
Inflation is an important consideration in long-term returns. Asset returns have been lower during periods of rising interest rates and higher during easing cycles. Real returns have also been lower during periods of high inflation and higher during periods of lower inflation. Gold and commodities stand out among the few inflation hedges. Since 1972, changes in the gold price have had a positive correlation of 0.34 with inflation.
Dan Dowd, Head of Global Research at UBS Investment Bank, said: “I’m pleased to once again collaborate with Professors Dimson, Marsh and Staunton, and our Global Wealth Management colleagues to deliver the 2025 edition of the Global Investment Returns Yearbook. The 2025 edition marks something of a milestone. With 125 years’ worth of data, it equips clients across the firm with a rich framework for addressing contemporary issues through the lens of financial history.”
Mark Haefele, Chief Investment Officer at UBS Global Wealth Management, said: “The Global Investment Returns Yearbook can help us see the long-term effects of following the principles of diversification, asset allocation, and risk and reward. It once again teaches that a long-term perspective matters, and not to underestimate the value of a disciplined investment approach.”
Professor Paul Marsh at London Business School, said: “25 years have elapsed since our first Yearbook. 21st century equity returns have been lower than in the 20th century, while bond returns were higher. Yet stocks still outperformed inflation, bonds and cash. Global stocks provided an annualized real return of 3.5% and a 4.3% equity premium versus cash. The “law” of risk and return continued to hold in the 21st century.”