How much is 1 VT worth in the future dollar-wise?

Investing / Others
1

I know nobody can predict the future but I am sure someone must have made some calculations what VT might be worth in 30 years dollar-wise (not taking into account dividends reinvested).

When I run a Monte-Carlo-Simulation on https://www.portfoliovisualizer.com (no contributions or withdrawals) it uses datas for VT from 2009 - 2018. I am not sure if it is a smart way to predict the future. Shall I just use the MSCI for longer historical data points?

Has someone already made this calculation or has any idea how to go forward with it?

Best,
Essential

1 Like
2

MSCI ACWI had 7.85%/year since 1987. I think it’s better to have lower expectations, something like 6-6.5%/year.

3

Out of curiosity what would be the use case of ignoring dividends? (also I assume you mean in inflation adjusted dollars, right?)

4

I was discussing with my girlfriend about VT.
I thought it would be easier to explain it to her when I can show her what 1 VT might be worth in the future. So it makes sense to invest and not just let the money sit in the bank. Our kids (progress in work) will likely experience the year 2100. So every dollar we invest now in VT is way better and cheaper in price today than in 20 years (in regards to a “Sparkonto”/Savings account for the kid).

So I made an Google Sheet: https://docs.google.com/spreadsheets/d/1HraeEdEBPVJwnb5fOyjae7qRwtKabVm4_xwjrlXoOjE/edit?usp=sharing
I forgot to enter the price ranges. For example the price for VT in 2040 (7%) could be ± “xx”%. The question is how big is “xx” (30%?)?
Something else I forgot or didnt consider?

5

In my opinion the key point to explain is being rewarded for risk taken. Unlike cash in the bank, equities have no guarantee for future value, and will often experience high volatility, but historically that risk has been rewarded by greater returns over long time horizon.

6

Is this the type of thing you’re thinking of? Taking into account the non-deterministic nature of the stockmarket? But be warned stock-market returns are not really Gaussian… it is a 2nd-order chaotic system…

image
image.png1235Ă—476 73.5 KB

1 Like
7

Suppose buy-&-hold forever, why not consider VT as a infinite bond with a coupon of 2.5% (annual dividends)?

1 Like