ANOTHER BEAR – When the S&P 500 closed at 3667 Thursday (6/16/22), the index was down 23.6% from its all-time closing high of 4797 set on 1/03/22, i.e., qualifying as a “bear” market decline of at least 20%. The drop was the index’s 11th “bear” since 1950 but its 2nd since the start of the global pandemic. The S&P 500 consists of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market value weighted index with each stock’s weight in the index proportionate to its market value (source: BTN Research)
IT MAY TAKE AWHILE – After suffering 10 separate “bear” markets between 1950 and 2021, the S&P 500 recovered and eventually achieved a new all-time closing high each time. The average length of time it took to retrace its steps from a “bear” market low to a new closing high was 25 ½ months or more than 2 years. The quickest recovery for stocks took place over just 3 months (in 1982) while the longest recovery took 70 months or nearly 6 years (between 1974-1980) (source: BTN Research).
DO YOU KNOW SHOPRITE’S ‘CAN-CAN’ SALE? – When certain items are offered for a substantial discount. Like Progresso Soup- 10 cans for $10 which are usually $1.89 to $2.49 EACH. If you like the soup (and who doesn’t) why WOULDN’T you stock up and buy at LEAST 10 cans? They don’t go bad; they always taste good and at this price ya’ can’t go wrong! They represent a tremendous VALE!
SO, WHAT’S THE POINT? When the market is ‘down’ 20+% why wouldn’t you buy in and take advantage of low prices? Whether you invest in mutual funds or individual stocks you’re probably not going to see prices this low again for a real long time! Could they drop further? Sure, so don’t deploy ALL your money at once; buy in gradually say 10-15% of cash on hand every few weeks.
Happy Hunting!
202206-FrankMcKinley-Newsletter