Stay The (Very Long Term) Course

Published August 28th, 2008 in Trading Tags: crash, crisis, history, long term, stock market, wars.

I can’t remember exactly where I first saw this graph but in any case, the source is cited at the bottom:

stay the course

While it is a valid argument that in the long run the market has only one direction, it is also true that in the long run, we’re all dead.

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1 Russ Abbott Aug 28th, 2008 at 8:40 pm

Interesting graph. Another moral one can draw is that most of the time the market does nothing. Eyeballing it, these are flat periods.

1871 - 1895 = 24 years
1899 - 1941 = 42 years
1960 - 1980 = 20 years
2001 - 2008 = 7 years
———-
93

So of the 137 or so years from 1871 to now, 93 of them were net flat leaving 42 as profitable periods.

– Russ
2 market folly Aug 28th, 2008 at 10:37 pm

good stuff thanks for posting again. kept forgetting where i’d seen this in the past.
3 Babak Aug 29th, 2008 at 1:45 am

Russ, exactly. There are long bouts when you are much better off in commodities, real estate, bonds, or in foreign stocks.

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