Do Stocks Beat Treasury Bills? A Hundred Years of the Answer
The mean US stock made a fortune and the median one lost money. Both are true, and the distance between them is the whole case for owning the market rather than picking from it.
The short answer: most individual stocks do not
Hendrik Bessembinder's One Hundred Years in the U.S. Stock Markets (2026-03) measures every one of the 29,754 common stocks in the CRSP database over 1926-2025, each over its own listed life. The result is the most quoted finding in modern market research, and it is not close:
- The mean lifetime buy-and-hold return is 30,621%.
- The median lifetime buy-and-hold return is −6.87% — the typical stock lost money.
- Only 41.17% of stocks beat one-month Treasury bills over the same months they were listed. 48.22% merely finished above zero, and just 27.60% beat the value-weighted market.
Both numbers are correct and they describe the same population. The gap between them is the finding: returns to individual stocks are so positively skewed that the average is set by a handful of names and tells you almost nothing about the one you picked.
See the three hurdles charted →
So where did the money come from?
Over the century, US stocks created $90.96 trillion of net shareholder wealth above what Treasury bills would have returned. Sort all 29,081 firms from worst to best and the accounting is stark:
- 17,197 firms (59.13%) destroyed $10.67 trillion.
- The next 10,802 firms (37.14%) put back exactly that much — the two groups, 27,999 companies or 96.28% of the sample, net to zero.
- The remaining 1,082 firms — 3.72% — account for the entire $90.96 trillion.
Concentration inside that top group is just as steep: Apple alone is 5.52% of the century's net wealth creation ($5.02 trillion), the top 5 are 21.4%, the top 10 are 29.0%, and the top 30 are 43.7%.
How few firms it takes, and how that changed
The table reads: how many firms, ranked by wealth created, you need before you have accounted for each share of the total. The middle column is the same calculation on the paper's earlier sample ending 2016; the last is 2017—2025 on its own.
| Share of net wealth creation | 1926—2025 | 1926—2016 | 2017—2025 |
|---|---|---|---|
| 10% of it | 2 | 5 | 2 |
| 25% of it | 8 | 20 | 4 |
| 50% of it | 46 | 89 | 13 |
| 75% of it | 208 | 195 | 77 |
| 100% of it | 1,082 | 1,088 | 411 |
Half the wealth of a hundred years came from 46 companies. On the sample through 2016 it took 89; in the 9 years since 2017 alone it took 13. The distribution is getting narrower, not wider — Nvidia by itself is 9.32% of everything created between 2017 and 2025.
See the concentration ladder →
Is this just a long-horizon artefact?
No. Bessembinder repeats the exercise over ten non-overlapping decades, pooling every stock present at each decade's start:
| Decade | Median return | Mean return | Beat T-bills | Beat the market |
|---|---|---|---|---|
| 1926—1935 | −24.53% | +19.39% | 36.08% | 33.48% |
| 1936—1945 | +132.08% | +198.32% | 89.38% | 57.32% |
| 1946—1955 | +144.86% | +225.37% | 86.59% | 30.37% |
| 1956—1965 | +69.32% | +126.84% | 74.65% | 43.53% |
| 1966—1975 | −27.07% | −0.75% | 21.54% | 33.91% |
| 1976—1985 | +87.20% | +333.44% | 59.05% | 48.84% |
| 1986—1995 | +8.08% | +84.67% | 45.95% | 30.27% |
| 1996—2005 | +11.24% | +87.52% | 48.89% | 36.39% |
| 2006—2015 | +2.52% | +45.29% | 49.00% | 36.26% |
| 2016—2025 | +1.44% | +71.20% | 47.70% | 24.34% |
Across all ten decades pooled (62,348 stock-decades), the median ten-year return is +11.56% while the mean is +112.38%, 48.99% beat bills and 35.62% beat the market. The median stock's ten-year return averages 63.6% across the first 6 decades and 5.8% across the last 4 — and in the decades beginning 1926 and 1966 the median stock lost money outright.
What this does and does not imply
- It is an argument for breadth, not against equities. The market itself turned $1 into $15,041 over the century (10.1% a year) against $25.34 in bills (3.3% a year) — an ex-post equity premium of 6.81% a year. Owning everything captured that; owning a few names is a coin-flip on catching one of the 1,082.
- Skew is the mechanism, not bad luck. A diversified portfolio wins because it cannot miss the winners, not because its average holding is good.
- The records are the point. The best cumulative performer, Altria, turned $1 into $4,420,000 over 100 years (16.53% a year); the best annualised, Nvidia, compounded at 37.04% for 27 years. Neither was identifiable in advance.
FAQ
Do most stocks beat Treasury bills?
No. Across 29,754 US common stocks measured over their own lifetimes (CRSP, 1926–2025), only 41.17% beat one-month Treasury bills. The median lifetime buy-and-hold return was −6.87%.
How many companies created all the US stock market's wealth?
1,082 of 29,081 firms — 3.72% — account for the entire $90.96 trillion of net wealth created above Treasury bills. The other 27,999 firms cancel out.
If the median stock loses money, why does the index go up?
Because returns are positively skewed: the mean lifetime return is 30,621% while the median is −6.87%. The value-weighted market turned $1 into $15,041 over the century, and an index holds the winners by construction.
All figures from /api/static/bessembinder-2026.json, a transcription of the printed tables in Hendrik Bessembinder, One Hundred Years in the U.S. Stock Markets (2026-03-21), computed on CRSP common stocks, 1926-2025. A static edition: it changes only if the paper is revised.