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Schannep Investment Advisors, Inc.
Your future is why we're here.
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The real rate of CD
Returns verses our
Conservative Income portfolio |
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As of 1/1/2007 |
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Certificates of Deposit |
Capital/Preservation Income Model |
Annual |
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Real Return |
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Real Return |
Advantage/ |
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Annual |
After Taxes |
Annual |
After Taxes |
Disadvantage |
| Year |
Taxes 2 |
Inflation 3 |
Rates 1 |
& Inflation |
Total Return |
& Inflation |
Over CDs |
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|
1994 |
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1995 |
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1996 |
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1997 |
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1998 |
|
1999 |
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2000 |
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2001 |
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2002 |
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2003 |
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2004 |
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2005 |
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2006 |
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31% |
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31% |
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31% |
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31% |
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31% |
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31% |
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31% |
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30.50% |
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27% |
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27% |
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27% |
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35% |
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35% |
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2.70% |
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2.50% |
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3.30% |
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1.70% |
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1.61% |
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2.68% |
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3.39% |
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1.55% |
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2.38% |
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1.89% |
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3.25% |
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3.42% |
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2.39% |
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4.96% |
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5.98% |
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5.47% |
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6.01% |
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5.65% |
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5.73% |
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7.13% |
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4.65% |
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3.02% |
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1.30% |
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2.26% |
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4.03% |
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4.03% |
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0.72% |
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1.63% |
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0.47% |
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2.45% |
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2.29% |
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1.27% |
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1.53% |
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1.68% |
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-0.18% |
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-0.94% |
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-1.60% |
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-0.80% |
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0.23% |
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1.22% |
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15.29% |
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7.56% |
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10.68% |
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10.05% |
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6.44% |
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5.26% |
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1.68% |
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0.54% |
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7.78% |
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4.49% |
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3.56% |
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7.11% |
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-1.86% |
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8.05% |
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1.92% |
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5.67% |
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5.32% |
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1.76% |
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0.24% |
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-0.38% |
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-1.99% |
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3.79% |
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0.03% |
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-1.11% |
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2.23% |
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-2.58% |
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6.42% |
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1.44% |
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3.22% |
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3.04% |
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0.49% |
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-1.29% |
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-2.06% |
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-1.81% |
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4.73% |
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1.63% |
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-0.31% |
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2.00% |
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| Average Annual Rate of Return: |
4.63% |
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6.28% |
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1.65% |
| Average Return after Taxes and Inflation: |
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0.67% |
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1.82% |
1.15% |
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1
The Federal Reserve Board
2 Rates based on $100,000 of taxable income for a person filing
single
3 U.S. Department of Labor Statistics
The table above demonstrates,
historically, that the real rate of return on CDs and our Capital
Preservation/Income model portfolios, when calculated after taxes and
inflation, are significantly lower that any stated rates. The purpose of
this demonstration is to illustrate that a portfolio consisting of 80% fixed
income and 20% stocks or equities historically produces a significant
increase in the total rate of return over Certificates of Deposits.
Past performance does not guarantee future results.
CDs are insured by the FDIC. Investment portfolios consisting of equities
and fixed income are not insured and their value will fluctuate with market
conditions.
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( Return to Investment Primer
Index )
This report is
prepared for general circulation and is for informational purposes only. It
is not intended as an offer or solicitation for the purchase or sale of any
financial instrument or service. Market prices and other data may be
obtained from outside sources and is not warranted as to completeness or
accuracy. Any comments, statements and/or recommendations made herein do not
necessarily reflect those of First Allied Securities, Inc., its subsidiaries
or affiliates, and are subject to change without notice.
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Securities offered through
First Allied Securities, Inc. A register broker/dealer. Member FINRA/SIPC.
Schannep Investment Advisors is a registered investment
adviser in the state of Arizona. First Allied Securities, Inc. does not endorse or
support this web site, nor are they affiliated with Schannep Investment Advisors,
Inc.
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