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Bob Carey
Chief Market Strategist
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  We See The Glass As Half Full
Posted Under: Broader Stock Market
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View from the Observation Deck

  1. The S&P 500 has never failed to eventually fully recover the losses sustained in a bear market. As a result, stocks continue to be one of the primary vehicles for building wealth over the long-term, in our opinion.
  2. The index officially closed above its previous all-time high of 1565.15 (10/9/07) on 3/28/13, at 1569.19. Since then, the index has gone on to set several more new highs.
  3. While we acknowledge that some investors may still be a bit leery about committing capital to the stock market, we are hard pressed in this low interest rate climate to find better opportunities for growing one's capital.
  4. From 1926-2012, the S&P 500 posted a negative total return in 24 out of the 87 calendar years, or 28% of the time. The average decline was 13.61%, according to data from Ibbotson Associates/Morningstar.
  5. What investors may find interesting is that the frequency with which the S&P 500 is posting negative return years has been generally on the decline since then (see chart).
  6. The current bull market has gone 600 days without experiencing a 10% correction. While one could occur at any time, the S&P 500 has gone as many as 2,553 days without a 10% correction (10/11/90-10/7/97).

This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the effects of taxes and brokerage commissions or other expenses incurred when investing. Investors cannot invest directly in an index. The S&P 500 is a capitalization-weighted index comprised of 500 stocks used to measure large-cap U.S. stock market performance. Past performance is no guarantee of future results. 

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Posted on Tuesday, May 28, 2013 @ 10:17 AM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
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