This claim will return five times the average annual rate of return on US stocks as measured by the Wilshire 5000 index (with dividends reinvested) between 1/1/2005 and 12/31/2008. (For example, if US stocks return 10% annually, this claim pays 0.50.) If the average annual rate of return exceeds 20%, this claim will return 1.00. If the Wilshire 5000 index is no longer available, the judge may substitute a comparable market-weighted total return index covering substantially all US stocks.
The term "average annual rate of return" refers to a geometric, rather than arithmetic, average. That is, if the total return over the 4 years is X%, the "average annual rate of return" is 1-(1+X%)^(1/4). Example: Total return over four years = 46.41% -> average annual rate of return = 10%