The Investment Scientist

Stock market just had worst 10 years in history

Posted on: April 1, 2009

Out of curiosity, I took the S&P 500 annual return data since 1926, calculated the index’s moving 10-year returns and produced the chart below. Two things are worth noting:

1. The 10 years ending 2008 are the worst ever for the index, with a total return of -13%.

2. The S&P 500’s 10-year return dynamic seems to follow a periodic pattern. The second worst 10-year period ended  in 1938 (-9%); and the third worst 10-year period ended in 1974 (13%), almost right in the middle of 1938 and 2008. Serendipity?

The market is in a trough. A chart can not predict the future, but if it can, things can only get better from here.

S&P 500 10-year return dynamic

S&P 500 10-year return dynamic

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5 Responses to "Stock market just had worst 10 years in history"

S&P 500 10 year return data is also available here: http://www.nytimes.com/2009/02/07/business/07charts.html .

Paul,

Thx for the link. The NYT chart uses a monthly data grid and I used a annual data grid. Otherwise, the result is the same.

Michael

I thought the S&P500 only came into being in the 1950s, and thus did not exist during the Great Depression?

It was reconstructed back to 1926.

can you please provide the link for daily OCLH since Jan 2001 of the major world indices.

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Author

Michael Zhuang is principal of MZ Capital, a fee-only independent advisory firm based in Washington, DC.

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