Stocks are Three Times More Likely To Go Up This Year Than Go Down
Igor Manukhov - Jan 17, 2023
Back-to-Back S&P 500 Yearly Declines Are Rare. Stocks are 3 times more likely to go up this year than go down.
Its important for investors to keep in mind that back-to-back annual declines in US stocks are rare. In fact, over the past 90 years, the S&P 500 has exhibited consecutive calendar-year losses only six times – 1939-40, 1940-41, 1969-70, 1973-74 and 2000-02.
Therefore, history tells us that the S&P 500 is roughly three times more likely to see a calendar-year gain in 2023 vs. a calendar-year loss.
Additionally, US stocks have recorded an average annual price return of 13.2% following yearly losses going back 90 years with gains occurring 74% of the time.
On average, the bigger the declines are in one year, the stronger the gains are in the subsequent year with annual losses greater than 15% being followed by a 10.1% average price increase.
