Boring Markets Are the Best

I looked at all the daily returns for the S&P 500 since 1957. If you take all the days when the S&P 500 moved more than 1.14% in a day, up or down, the combined return comes out to zero. They completely balance each other out.

The entire return, more than 55-fold over 60 years, comes on the low-volatility days (up or down less than 1.14%).

The high-volatility days happen 16.5% of the time, or roughly one day in six. (I’m just looking at capital gain and not dividends.)

Historically, it’s been to your advantage to stick with a boring, low-vol market.

Posted by on October 23rd, 2017 at 9:18 pm

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