Equities over a longer period of time deliver returns in line with the earnings growth. While such growth reflects in the share prices of stocks over the long term, they may fluctuate in short term due to various reasons. The chart below shows examples of Infosys and Reliance Industries where price appreciation over a 10-year period has been almost equal to the profit growth during the same period. Therefore it is easier to assess earnings growth rather than short-term prices of stocks prices.
Click here for the 10-year statistics.