“With a 27% total return for the S&P 500 this yr, history says Y 2022 may see more gains for equity investors” — Paul Ebeling
Going back to Y 1950, when the S&P 500 had a total return of at least 25% in a yr, stocks mostly rose in the following year. The outcome during that 71yr frame stocks advanced 82% of the time, that is 14 out of 17 times.
In 2 of the 3yrs where stocks failed to rise after 25%+ annual gains were in Ys 1981 and 1990, in both of those periods the economy went into recession. The other down yr was 1962 was challenged by a crash and deteriorating investor confidence.
We do not see a recession on the cards for Y 2022, but gainers in stocks may have more modest gainers after a the strong Y 2021.
Our position is: encourage our clients to stay in the market, diversify out of government bonds into cryptocurrencies.
Have a prosperous week, Keep the Faith!