Is This Really One of the Calmest Markets Ever?

As hard as it might be to believe, U.S. equities historically have been calm over the past few months. “If all you listened to was the news, you would think markets were having huge bouts of volatility. Turns out, that isn’t true at all, as the past three months have been among the least volatile in history,” explained Senior Market Strategist Ryan Detrick.

As our LPL Chart of the Day shows, the S&P 500 Index has now gone 64 consecutive days without a 1% change either up or down, barely topping the streak of 62 days seen in 2014. Going back to 1990, only 1993, 1995 and 2017 had longer streaks without a 1% daily change, and those years are widely considered among the least volatile in history.

This is One of the Calmest Periods Ever for Stocks

How many people would be aware of this? We are willing to guess not many, as even we were surprised, and we do this each and every day. This reminded us of a recent stat in Barron’s, citing a survey from robo-advisory firm Betterment, in which 18% of the 2,000 people surveyed actually thought stocks had been down the past 10 years. Given the S&P 500 Index is poised for a tenth consecutive yearly gain in 2018 (on a total return basis), the perception that stocks have been down the past 10 years seems inconceivable.

Let’s sum it up like this: When it comes to investing, we need to remove our biases and simply follow the facts.

For more on biases and investing, be sure to listen to the latest edition of the LPL Market Signals podcast, where we discuss the makeup of Congress and how it could impact stocks.


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