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Where now equity cow?

Posted: Sun Jan 13, 2013 1:39 pm
by BlueEars
Here are 2 charts that tell us a bit about past SP500 history. First a comparison in decades going back to the 1940's :

Image

Now a comparison of markets off the SP500 lows:


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Re: Where now equity cow?

Posted: Sun Jan 13, 2013 3:11 pm
by nedsaid
We know that equity markets can be flat for stretches of 15-20 years. We are in year 14 of a flat to slightly down market. How much longer will this continue?

History suggests that strong bull markets follow these long secular bear markets. Most of us experienced the 1982-2000 bull market. What we forget was a flat period from about 1968-1982. Before that was the nifty fifty and all of that.

Hard to say if we are experiencing a new bull market are a bull phase in a long secular bear. This flat market may continue for a while. In any case, our patience will eventually be richly rewarded. I hope the reward comes sooner rather than later.

Re: Where now equity cow?

Posted: Sun Jan 13, 2013 4:30 pm
by PS241
nedsaid wrote:I hope the reward comes sooner rather than later.
I hope later than sooner..but that's coming from a young person with only a little in the market. Then again maybe I've got the math wrong on that...

Re: Where now equity cow?

Posted: Sun Jan 13, 2013 4:47 pm
by baw703916
The equity cow says that stocks ar moooooving higher!

Re: Where now equity cow?

Posted: Sun Jan 13, 2013 8:10 pm
by z3r0c00l
I hope 1980s, fear 1970s but without the inflation.

Re: Where now equity cow?

Posted: Sun Jan 13, 2013 8:34 pm
by jon-nyc
Interesting graphs, thanks for posting that.

Re: Where now equity cow?

Posted: Sun Jan 13, 2013 8:47 pm
by papito23
BlueEars wrote:Here are 2 charts that tell us a bit about past SP500 history. First a comparison in decades going back to the 1940's :

Image
A 5% return this decade would give that graph some really tidy symmetry. Reversion to mean on a cosmic scale?

Great chart BTW, thanks.

Re: Where now equity cow?

Posted: Sun Jan 13, 2013 11:15 pm
by pkcrafter
Excellent data presentation. As Forrest Gump might say, it looks like a box of chocolates.

Also confirms what William Coaker.CFP says:
Investment professionals often tell clients, “I think the S&P 500 will be up 10 percent next year,” and clients like to hear that. But it almost never happens. From 1926 to 2004, the S&P 500 rose between 8 percent and 14 percent in only six years, an 8 percent occurrence. In fact, just 25 times in 79 years the S&P 500 returned between 0 percent and 20 percent, which is only 32 percent of the time. That means the index has been more than twice as likely to lose money or gain more than 20 percent than to experience returns between 0 percent and 20 percent.
Paul