If the long-run return on the market is 9.4% (as researchers at Credit Suisse say), then investing in shares should be a no-brainer. Somehow, however, all too often our portfolios don't seem to reflect that attractive performance.

This is partly because that 9.4% number is an average derived from 100 years of data. Picking various time periods within that 100 years gives very different outcomes -- and the market almost never actually returns 9.4% in any single year.

Needless to say, unless you're holding a market tracker, your portfolio could have dramatically different results than what the market experiences. If you own a disproportionate amount of winning shares, your returns could be significantly better than the market. On the other hand...

In this series of articles, I'm looking at how individual shares have performed against the FTSE 100 (UKX) during the past 10 years. Today, I'm assessing one of the more snakebitten global oil majors BP (LSE: BP.L) (NYSE: BP).

Over the last decade, BP's performance has clearly lagged behind that of the FTSE 100.

Source: S&P Capital IQ

Since November 2002, BP's shares have had a pedestrian average annual return of 4.9% -- underperforming the FTSE 100's 7.4% annual average (these return calculations assume dividends were reinvested).

Of course, share price is one thing, valuation another. So how has BP compared on a valuation basis over the years? BP has traded on an average price-to-earnings (P/E) ratio of 12 over the past 10 years, slightly below the FTSE 100's average of 13.

Source: S&P Capital IQ and Bloomberg

However, the shares are currently trading well below both the market's and their own historical averages. Of course, the past is history and investors must ask themselves what they think the future holds for a company. Will BP be able to shake off the Gulf of Mexico disaster -- and its cash flow implications -- and achieve management's 10-step plan to transform the company and increase shareholder value by 2014?

The recent sale of its stake in the troubled TNK-BP partnership in Russia will provide a nice $12.3 billion cash windfall and a nearly 20% stake in Russia's state-owned oil major Rosneft, which appears to be a good start. As does the 12.5% increase in the quarterly dividend to produce a nearly 5% yield.

So do you see BP as an overly sold global energy giant on the mend, or a troubled behemoth set to stumble into the future?

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.