As painful as the past 18 months have been, history shows us that painful bear markets often lead to big returns. USA Today recently noted some of our research.
“Reasons there could be even better gains on top of the rebound since March include:
Historic downturns give way to historic rallies. The S&P 500’s best one-year recovery followed its biggest decline from August 1929 to June 1932, Ibbotson says. The S&P 500 posted a 163% total return the 12 months after the June 1932 bottom, easily topping the next-best recovery of 42% in the 12 months after the June 1970 bottom.
Recent recessions have ended with powerful bull markets. In the 12 to 21 months following the market bottoms after the previous five recessions, the Dow on average rocketed 55%, says Navellier & Associates.”