In January, the U.S. stock market reached an all-time high. The S&P 500 Index, which includes dividends, closed the month with a 1.7 percent gain. For some, this signals the end of the “bear market”.

Bear markets have always come to an eventual end in the U.S. stock market. The worst of these was the Great Depression, where the market plunged by 75 percent from its apex, requiring 15 years to fully recover to new highs. In more recent memory, the financial crisis of 2008 witnessed a peak-to-trough decline in the S&P 500 of over 50 percent, yet it only took four and a half years to surpass previous highs.

This pattern of market fluctuations has always led to eventual recovery, back to new all-time highs. It is a primary reason why we advocate for investors to maintain a long-term perspective and stick to their investment strategies. The stock market reflects ownership in the world’s most significant, most profitable, and most innovative companies. Historically, these corporations have demonstrated an ability to grow earnings and deliver positive returns to investors overall. While in hindsight, it seems so simple, living through bear markets is anything but easy. Looking back, it may appear deceptively straightforward, but navigating through bear markets proves to be a formidable challenge.

The table below examines instances where the S&P 500 dropped by at least 20 percent, using month-end data. It measures the duration from a previous all-time high to a subsequent all-time high following a decline of at least 20 percent.

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How To Define “The Market”
2023 Tax Forms
IRS: Pick A Tax Preparer Carefully
Tax Planning: A Year Round Sport
The High-Yield Dow Investment Strategy
Recent Market Statistics
The Dow Jones Industrials Ranked By Yield
Asset Class Investment Vehicles