Investor Education: Stay invested

[Pages:2]Bull markets versus Bear markets

To pursue the greater return potential of stocks, it makes more sense to stay committed to an investment plan rather than try to guess the best time to be in the market. Over the past 72 years, bull markets have lasted longer (49 months on average) than bear markets (13 months on average) and have more than made up for the periodic market declines. Bull markets have begun during economic recessions and expansions and at all levels of rates. And while it is impossible to predict when a bull market will begin, it is possible to miss one by waiting on the sidelines.

Bull markets Bear markets E Expansions R Recessions Federal funds rate

Federal funds rate

600% R 550% 500% 450% 400% 350% 300% 250% 200% 150% 100% 50%

E

R

E

R ER

E

91 months

401%

Percent change of the S&P 500 Index for each bull and bear market since 1949

R

E

R

E

RE R

19 months

59%

14 months

39%

43 months

90%

26 months

52%

30 months

76%

27 months

86%

33 months

87%

E

R

E

61 months

280%

30 months

72%

Federal funds rate is the interest rate at which private banks lend money for overnight loans. The Fed generally raises the target federal funds rate to slow economic growth, and lowers the rate to facilitate growth.

R

E

R

E

118 months

526%

61 months

108%

26 months

94%

R 24% 22% 20% 18%

111 16% months

302% 14%

12% 10% 8% 6% 4% 2%

YEARS '49 '50 '51 '52 '53 '54 '55 '56 '57 '58 '59 '60 '61 '62 '63 '64 '65 '66 '67 '68 '69 '70 '71 '72 '73 '74 '75 '76 '77 '78 '79 '80 '81 '82 '83 '84 '85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20

-50% -100% -150%

-14% -8% -22% -16%

17

15

6

8

months months months months

-29%

19 months

-43%

21 months

-14%

14 months

-17%

20 months

-30% -15%

3

5

months months

-45%

25 months

-51% -16%

16

5

months months

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