Compound Outperformance

In order to better comprehend the potential benefit of investing in a product that outperforms the market, the following chart is provided.  The chart shows the effect of investing in  a fund that outperform the market by 5%, 10%, 15%, 20%, and 25% over 10, 20 and 30 years. For instance, if one believes that Magnolia’s Alpha fund will outperform the market by 15% a year for 20 years and invests in the fund, after 20 years this investor will have 16X what they would have had had they invested in the fund’s benchmark, the iShares ETF that tracks the NAREIT Industrial and Office REIT Index.

compound outperformance