Bull markets or long term upward price appreciation are the golden child. They reflect the recoveries and expansions of the economic world. Economic recoveries and growth push spending and investment forward and compound. The simple act of spending and investing creates more of the same like that of an ant discovering a food source and reporting it back to the colony where the mass pursues the new fulfillment for further existence.
Over the last one hundred years, and based on the historical data from Standard and Poors and Yardeni, since 1929 until February 2020 there have been twenty-three trough to peak upward markets. Twenty-three seems quite low considering it covers over a ninety year period. Further investigation shows that these bull markets vary in time from a short time span of three months to the longest lasting over twelve years.
The data shows that in the last ninety years a ninety day trough to peak upward market occurred only five percent of the time, and that bull markets lasting over three years occurred thirty five percent of the time. The longest of markets, which are also the most recent, have lasted eleven and twelve years respectively accounting for eight to nine percent of the occurances.
The returns for these markets have ranged from twenty percent to shy of six hundred percent. The bulk of the returns are in the twenty to three hundred percent range for a bull market gain. A gain of sixty to three hundred percent represents sixty percent of the total occurrences.
Current Bull Market
As we currently float on our backs in our oceans of the current bull market starting from the trough of March 23, 2020 what are the chances of the waters changing? Currently, we sit at approximately three hundred days into the current bull market trend. Historically, about fifty percent of the historical bull markets have ranged under seven hundred days. Three hundred days or less only accounts for thirty percent of all historical bull markets.
The current trough to current peak run has risen approximately seventy-seven percent on the S&P, and historically a twenty to eighty percent gain fits in the mid fifty percent range of all data occurrences. A seventy to eighty percent bull market gain has occurred seventeen percent of the twenty-three troughs to peak. Only a gain of one hundred to a hundred-fifty percent has occurred the same seventeen percent of the time over the last ninety years.
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