Some Perspective on the “Can’t Lose” Market

Here are some wild stats about the current rally in the S&P 500 in 2013 which brings the gains to 17%+:

• Of the twenty weeks this year, just four have been negative weeks.  
• Of the four negative weeks just one has included a loss over 2%.
• Of the four negative weeks just two of them included losses over 1%.
• There have been zero 4%+ corrections this year.
• The S&P 500 has gained about 0.18% on average per day year to date.
•  The S&P 500 has traded above its 50 day moving average for 98% of the year.
• The S&P 500 is 12.8% above its 200 day moving average.
• The S&P 500 trades at 12.8% or higher from its 200 DMA just 8.3% of the time.
• Said differently, the market spends 91.7% of its existence BELOW the current levels.

• Bonus scary fear mongering unimportant corollary:  in 1987 the market shot out of the gates to a 18% gain by May 15.  It rallied another 10% before losing more than all of the annual gains in October during the crash.

There’s some perspective on how incredible this year’s move has been so far.

Cullen Roche

Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.

He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.