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A challenge to triumphant optimists? A blue chips index for the Paris Stock-Exchange (1854-2007)

Author

Listed:
  • David Le Bris

    (UP4 - Université Paris-Sorbonne)

  • Pierre-Cyrille Hautcoeur

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)

Abstract

We analyze a new blue chips (large caps) stock index for France from 1854 to 1998. We detail its methodology and show that it differs profoundly from earlier indices, and that it is more consistent with the French financial and economic history. We suggest this result casts some doubt on many historical stock indices such as those gathered in Dimson, Marsh and Staunton "Triumph of the Optimists". We also provide some major results: investment in French stocks provided a positive real return during the 19 th century, but a negative one because of inflation and wars in the 20 th . Despite this century of negative real performance, stocks are still the best financial asset for the very long run but, with an equity premium lower than in the US.

Suggested Citation

  • David Le Bris & Pierre-Cyrille Hautcoeur, 2009. "A challenge to triumphant optimists? A blue chips index for the Paris Stock-Exchange (1854-2007)," PSE Working Papers halshs-00586765, HAL.
    • Handle: RePEc:hal:psewpa:halshs-00586765
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00586765
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