As Wall Street’s current bull market celebrates its fourth anniversary this week, some investors are voicing concerns that the rally is reaching a mature stage. However, historical data compiled by Ned Davis Research suggests that longevity should not be viewed as an inherent threat to the trend.
An analysis of 38 bull markets since 1900 reveals that 33 of them were shorter than the current run. While the average duration for these historical rallies stands at 25 months and the median at 22 months, the current market has already surpassed those benchmarks, indicating that such concerns may be premature.
Mark Hulbert, a MarketWatch columnist, noted in a recent reflection that the prevailing anxiety does not align with the broader historical record. The data implies that bull markets do not necessarily “die of old age,” and the current extension of the rally is consistent with the possibility of continued growth rather than an imminent correction based solely on its duration.
Does this data account for inflation or interest rate shocks? The 1970s weren’t exactly a party for stock owners despite the duration.
Wait, really? I always thought bears were like fine wine—they just get better with age? Maybe I should hold onto my tech stocks then.
Finally someone uses actual history instead of internet fear-mongering. The numbers clearly show duration alone isn’t a sell signal.