US Equity Returns Following Sharp Downturns
April 7, 2020
Sudden market downturns can be unsettling. But historically, US equity returns following sharp downturns have been positive.
- A broad market index tracking data since 1926 in the US shows that stocks have generally delivered strong returns over one-year, three-year and five-year periods following steep declines.
- Just one year from a decline of 10% or 20%, returns where higher than the long-term average of 9.6%. And the return after a 15% decline was within half a percentage point of the average.
- Looking thee and five years later also shows annualized returns higher than the long-term average.Sticking with your plan helps put you in the best position to capture the recovery.
Coppertree, LLC is a Registered Investment Advisor