5 Ways To Look At Stock Market Performance

Stock market performance can be shown in many different ways. There are rolling returns, tables, charts, and graphs, and even things called stock market maps.

01 of 05

Stock Market Performance - Best and Worst Rolling Returns

Various views of past stock market performance.
Rolling returns give you a better picture of historical stock market returns. SaulGravy/GettyImages

The charts in this series show you stock market performance in the form of rolling index returns. Rolling returns give you a much better indication of stock market performance than most other ways of looking at market returns.

Rolling returns do not go by the calendar year; instead, they look at every one-year, or every three-year, every five-year, etc. time period beginning each month anew over the historical time frame selected.

The chart goes back to 1973 to show you stock performance for the worst one-year rolling time frame (the twelve months ending in February 2009 that delivered a -43 percent return) to the best one-year index return (the twelve months ending in June 1983 that delivered a 61 percent return).

02 of 05

Presidential Elections and Stock Market Performance

Financial Advisor and Client
Some people feel the Presidential election always means one scenario. A conversation with a market researcher may show you both sides of the story. Andrew Olney / Getty Images

Every four years, the same question arises, “It’s an election year, what will the stock market do?” The table in this article shows the return of the S&P 500 Index for each election year since 1928.

If you take a glance at this, you'll see that of the last 21 election years there have been only 3 years where the S&P 500 index had a negative return during an election year. That tells you a lot about presidential elections and stock performance.

03 of 05

Stock Market Maps - A Colorful Way To View Market Performance

Bubble map of stock market performance.
Market maps are a fun way to view market performance. FinViz

A stock market map provides a unique and colorful way to view the performance of stocks, asset classes, sectors, or an entire country’s stock market relative to its peers. You'll find any of these five market maps useful because these visual readings make it very easy to understand market performance; in the U.S. and abroad.

04 of 05

Historical Bear Markets and Stock Market Performance

Bear market and graph
Every bear market is different and only time will tell how long it lasts before a new market high is attained. Adam Gault / Getty Images

Bear markets are defined as a period of time in which the stock market dips down 20 percent or more from its peak to a trough. Statistically, a bear market occurs about 1 out of every 3.5 years and lasts an average of 367 days. Two historic market tumbles include the 1970's when the market dropped 48 percent over 19 months and the 1930's when the stock market dropped 86 percent over 39 months.

This article offers a deep dive look at bear market statistics, how often they occur, how long they last, and how quickly the market typically recovers.

05 of 05

A Look At S&P 500 Stock Market Performance Since 1973

Financial advisor with cient
Navigating a volatile market requires confidence and courage, not all markets will be what you hope to see. Martin Barraud / Getty Images

This article contains a table which shows you the historical stock market performance dating back to 1973, on a year by year basis. Historically, negative stock market returns occur, on average, 1 out of every 4 years.

There is little consensus as to when stocks were first traded. Some see the key event as the Dutch East India Company's founding in 1602. What we do know is that the American Stock Exchange merged with the National Association of Securities Dealers in 1971 creating The Nasdaq-Amex Market Group, or NASDAQ. When the NASDAQ began trading on February 8, 1971, it became the world's first electronic stock market, trading for over 2,500 securities.

We also know that over time, if you hang in long enough, you will always see the positive years outweigh the negative years.

Past Performance Does Not Equate to Future Performance

The most common thing you see on investment disclosure documents is a statement that says, "Past performance does not guarantee future results." While this is true, few seem to believe it. Just because a stock or fund went up over the past few years does not mean it can't go down next year. Base your investing decisions on long-term averages, on risk, and on your goals. Don't use past performance to invest in the things that had the highest returns over the last few years. This is not an effective approach to investing.

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