A Note from the Team
The U.S. economy and stock market are on an upward trend. Here are some facts to ponder for this month:
- As of the end of March 2017 (latest data available), the average U.S. household had 34.3 percent of their assets invested in stocks of various types, as compared to the 50-year average holding of 28.8 percent.
- The U.S. economy has been in recession 12 percent of the time since the end of World War II. The stock market has generated a positive return during 81 percent of those same years.
- It has been 294 trading days since the last 5 percent downside correction in stock prices. That equates to about 1-1/2 years. Going back in time, the average period between 5 percent corrections has been 51 trading days.
- In 1982, U.S. stocks held by households totaled about 27 percent of assets. Over the following ten years, the U.S. market generated a return more than 17 % per annum.
- The high-water mark in the year 2000 when households held more than 55 percent of their financial assets in stocks – the Standard & Poor’s 500 Index generated no return over the following 10-year period.
- As can be seen, the inverse relationship between stock market exposure and subsequent stock market returns carry a correlation of 0.91 since 1951.
More next month…
Please take a look at our in-depth newsletter here:
- Macro-Economic Overview
- Equity Overview
- Fixed Income Update
- International Update
- Market Notes