Long-Term Look At Recessions And Returns

With Christmas less than a week away, we decided to look at historical equity market returns, but in the shape of a Christmas tree.

As you can see below, the majority of the returns have been between 0% and 10%, with the more extreme gains and losses taking place less often as the percentages get larger. We added which years included a recession in red, according to the National Bureau of Economic Research (NBER) going back to 1854. Per Ryan Detrick, Senior Market Strategist, “Yes, more recessionary years saw negative returns more often than not, but surprisingly there have been some strong equity returns during years that had an official recession take place. Obviously most of these big gains took place as the recession was ending; still, this is eye-opening and reinforces not focusing too much on just fundamentals, but also incorporating valuations and technicals. ”

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Past performance is no guarantee of future results. All indexes are unmanaged and cannot be invested into directly.

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The economic forecasts set forth in the presentation may not develop as predicted.

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The New York Stock Exchange is based in New York City, and is considered the largest equities-based exchange in the world based on total market capitalization of its listed securities.

The S&P 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

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