A general rule of thumb is that a handgun will keep shots within 4 inches at 25 yards minimum. This figure seems to be widely quoted in various gun magazines and this figure is arrived either by bench rest, or placing the gun in a mechanical device (Ransom Rest) to eliminate shooter variables.
That said, guns seem to prefer certain lots of ammo and a prettygood performance from an off the self service weapon is 2 to 3 inches at 25 yards. I find the range tests reported from the NRAs "American Rifleman" to be the most "honest" results as they do not seem to get the shear number of ads from various gun makers. They typically test guns using the Ransom rest and often report groupings of 3 to 4 inches at 25 yards on the average with occasional 2 inch groups with a particular brand of ammo.
The advantage of reloading, is finding a "magical" combo or bullet and powder that will give you exceptional results. I was lamenting the shortage of Rainier 124 gr TC copper washed bullets from my favorite supplier (zerobullets.com). Rainer has been substituting their bulet with the South African made Frontier. My groups, at rest, were 2.5 to 3 inches which was not merely as good as with the Rainer....But today, I went to the range with some Frontiers loaded with 4.2 gr of Titegroup (instead of my usual 4.4 gr) and the groups were once again wht I'd expect from the Rainer (4 shots in one ragged hole and one flier an inch away at 50 feet).
I have found my XDs (XD40, XD9SC and XD9 Tactical) are all capable of excellent accuracy with the proper load.
If you are shooting off hand....A really excellent performance is to keep 5 shots in 3 inches at 50 feet. I have in fact done this a few times, but 99% of the time, I struggle to keep all my shots withing 6 to 7 inches off hand at 50 feet with centerfire and 4 to 5 inches with my Ruger .22 using iron sights. If someone is staring over my shoulder; forget it....
