Market Bottom Recovery
by Doug on Sep.01, 2009, under Financial
Average annual returns of the S&P 500 Index after declines of 20% or more.
| Market Bottom | 1 yr later | 3 yrs later | 5 yrs later | 10 yrs later |
| 2002 Sept | 22.2% | 14.7% | 13.4% | N/A |
| 1987 Nov | 18.8% | 11.8% | 13.4% | 15.3% |
| 1982 July | 51.8% | 21.3% | 24.4% | 14.8% |
| 1974 Sept | 32.0% | 15.0% | 11.5% | 10.1% |
| 1970 June | 37.1% | 13.0% | 4.6% | 4.3% |
| 1962 June | 26.7% | 15.4% | 10.6% | 6.9% |
From T. Rowe Price and S&P 500 Index data.
The data shows us the biggest recovery is one year after the bottom was reached. The implication is if you are trying to time the market and miss the bottom, you will miss a good gain.
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