Longest Bull Market in History

Discussion in 'Investments' started by Sarenco, 23 Aug 2018.

  1. moneymakeover

    moneymakeover Frequent Poster

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    Sorry GG can you explain/expand?
     
  2. Gordon Gekko

    Gordon Gekko Frequent Poster

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    When you say “explain/expand”, what do you mean?

    The average annual pullback or drawdown is circa 13%.

    That’s the peak to trough move during a 12 month period.

    So say the Index goes from 100 down to 87 during 2019. The media will be screaming “MARKET CRASHING!!!”, but in reality it’s more or less average in terms of a move.
     
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  3. Gordon Gekko

    Gordon Gekko Frequent Poster

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    The takeaway for me is that, even in benign conditions, an equity investor needs to be prepared for corrections of greater than 10% on the basis that they’re completely normal.

    However, he/she must be ready to have the idiot of the week shouting in their ear via the media that “the end is nigh”.
     
  4. moneymakeover

    moneymakeover Frequent Poster

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    Just to be clear, are you saying during a bear market there tends to be a 13% on average drop.
    No need to panic, it's completely normal.
    And 13% is perfectly fine for person's pension who has 20 years to retirement?
    Or an investor holding for the long term?
     
  5. Gordon Gekko

    Gordon Gekko Frequent Poster

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    No!

    That during perfectly normal market conditions, on average, markets will fall by circa 13% from peak to trough.

    i.e. it is perfectly normal for someone to be able to say at some point during a given year: “Jesus, markets are down 13%!”

    Not a bear market, just ordinary life.
     
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  6. moneymakeover

    moneymakeover Frequent Poster

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    If that happens during a normal year then how is that compatible with an average 4% annual increase?
     
  7. moneymakeover

    moneymakeover Frequent Poster

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    Are you saying during the same 12 month period it can be up 4% but there may be a 13% drop between two dates?
     
  8. Gordon Gekko

    Gordon Gekko Frequent Poster

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    Yes
     
  9. galway_blow_in

    galway_blow_in Frequent Poster

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    A bear market is a 20% minimum drop, most years since 2009 have not seen a 13% correction however.
     
  10. Gordon Gekko

    Gordon Gekko Frequent Poster

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    49%, 28%, 16%, 19%, 10%, 6%, 7%, 12%, 11%, and 3% for the S&P since 2008.
     
  11. joe sod

    joe sod Frequent Poster

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    january 2016 was certainly nasty, i think it was down by 19% in a few days and that was after a bad ending of 2015. I think the market crashed by more in those few days than even 2008. The thing is when it is happening it is the real deal , its like a nightmare when you are having one it is real, its only when you wake up you realise it was a nightmare
     
  12. galway_blow_in

    galway_blow_in Frequent Poster

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    your starting year should be 2010 as i said since 2009 .
     
  13. galway_blow_in

    galway_blow_in Frequent Poster

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    which market are you talking about ? , 2016 didnt see anything like a 19% correction on the s + p .
     
  14. Gordon Gekko

    Gordon Gekko Frequent Poster

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    What exactly is your issue?

    I provided 10 years to give a meaningful period.
     
  15. galway_blow_in

    galway_blow_in Frequent Poster

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    just correcting your obvious mistake , thats all.

    i said since 2009 so 2010 is the starting year for any detail with respect of sell offs .

    most years starting in 2010 to now have not seen a 13% sell off in the s + p .
     
  16. Gordon Gekko

    Gordon Gekko Frequent Poster

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    How is it an obvious mistake?

    I listed the drawdowns and specifically stated that they were from 2008.

    It’s annoying to be a pedant, but it’s bizarre to be a pedant who gets things blatantly wrong and then argues about it as you appear to be doing.

    Best of luck.
     
  17. galway_blow_in

    galway_blow_in Frequent Poster

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    Last edited: 15 Oct 2018
    Correcting a mistake isn't pedantic, if you find that annoying, I also wish you luck.

    The 40% plus drop in 2008 is irrelevant within the context of my post yet you stuck it in there for your own arbritary reasons, references to 2008 distort trends as such years are so rare.
     
    Last edited: 15 Oct 2018
  18. Gordon Gekko

    Gordon Gekko Frequent Poster

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    Which is why I highlighted that it was from 2008.

    No mistake.
     
  19. galway_blow_in

    galway_blow_in Frequent Poster

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    You quoted my post which clearly states a 2010 starting point !

    Your point-thesis is - was beside the point.
     
  20. moneymakeover

    moneymakeover Frequent Poster

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    Today rebound

    Credit to those who held their nerve