Average profit and cost of investing in shares on the Warsaw Stock Exchange (1998-2012). Should I transfer my savings from the bank to the stock market?

The purpose of this article is to evaluate the concept, measurement and magnitude of average earnings per share and costs on the WSE (in 15 years’ time). The point of view of a ‘small’ investor who is considering transferring part of his savings from the bank to the stock market is presented. The main conclusions are: the average stock exchange long-term return was about twice as high as the interest rate on bank deposits, and this relationship should continue to be attractive in the future. Commissions privilege small and long-term investors. They overburden the short-term ones, who are forced to achieve returns at staggeringly high levels for the mere payment of commissions. A more theoretical analysis of two methods of measuring marginal and all-quotes returns of the period was made. The discrepancies in their results that can lead to contradictory conclusions have been assessed. Their interpretation and principles of choice were proposed. It was proposed that the return ‘from marginal quotes’ should be applied to actual investments and ‘from all quotes of the period’ to hypothetical ones.