| Bear Market |
Duration (Months)
|
% Decline
|
Years Needed to Breakeven (yrs)
|
| Sept. '29 - June '32 |
33
|
86.7
|
25.2
|
| July '33 - Mar '35 |
20
|
33.9
|
2.3
|
| Mar '37 - Mar '38 |
12
|
54.5
|
8.8
|
| Nov '38 - Apr '42 |
41
|
45.8
|
6.4
|
| May '46 - Mar '48 |
22
|
28.1
|
4.1
|
| Aug '56 - Oct '57 |
14
|
21.6
|
2.1
|
| Dec '61 - June '62 |
6
|
28
|
1.8
|
| Feb '66 - Oct '66 |
8
|
22.2
|
1.4
|
| Nov '68 - May '70 |
18
|
36.1
|
3.3
|
| Jan '73 - Oct '74 |
21
|
48.2
|
7.6
|
| Nov '80 - Aug '82 |
21
|
27.1
|
2.1
|
| Aug '87 - Dec '87 |
4
|
33.5
|
1.9
|
| July '90 - Oct '90 |
3
|
19.9
|
0.6
|
| Mar '00 - Oct '02 |
31
|
49.2
|
?
|
| Source: Telephone Switch
Newsletter, summer 1992. Updated by Flexible Plan Investments, Ltd. through
2006. |
| Bear Market Facts: |
Mathematics of Declines and Advances:
|
|
Between 1929 and 2006 there have been 14 bear markets, defined as those periods
when the S&P 500 has fallen at least 20%.
The average bear market slashed almost 38.2% from stock prices. Omit the '29
crash, when values declined 87%, and the result is still an average loss of
34.5%.
During the 77-plus-year period, a new bear market began on the average every 5.5
years, with an average duration of 18.1 months.
Omitting the distortion of the 1929 crash, the average time lost making up bear
markets (zero earnings): 3.5 years.
Source: FPI 2007.
|
If The Decline Is
|
It Takes The Following To Breakeven
|
|
-5%
|
+5.3%
|
|
-10%
|
+11.1%
|
|
-25%
|
+33.3%
|
|
-33.3%
|
+50%
|
|
-50%
|
+100%
|
|
-75%
|
+300%
|
|
-90%
|
+900%
|
|
|
|
Introduction