The longest S&P 500 bull market in history is over, ending three days after its eleventh birthday. It’s the ‘worst birthday ever’ for a bull run that was often described as “most hated”. The clock now starts running on the length of the new bear market. The next bull market won’t begin until the bottom is known – and then only in retrospect. Bear markets aren’t comfortable, and things will not move in a straight line, but it’s important to remember that bull markets generally run longer and create vastly more wealth than bear markets destroy. Going back to 1942, the average duration of S&P 500 bulls is 63 months and bears just 15 – the average cumulative return is 171% versus -33%. It’s a better strategy to navigate through bear markets rather than trying to navigate around them (said another way – stay invested). The past few weeks have demonstrated a familiar pattern: the worst daily losses are often accompanied by some of the largest daily gains.
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