Last Monday the Dow Industrials fell by 777 points after the US Senate didn’t pass the 700 billion bailout package. Most news reporters informed the public that Mondays drop in the oldest US stock index was the largest one day point drop ever. They were correct in this one. The issue is that this was not the largest drop in percentage terms. In other words even though last Mondays drop was higher than the one on Black Monday in 1987, it was much lower in percentage terms. Armed historical with data from yahoo finance going back to 1928 I isolated the 20 largest one day percentage drops in the Dow Industrials. It seems like the largest point drop ever turned out be the 18th largest percentage drop. You could check out the original spreadsheet from this link.
The average performance one year after a large one day percentage drop was 6.46% (without accounting for dividends).
Relevant Articles:
- Average Durations of Previous Bear Markets
- Dow 370,000
- The ultimate passive investment strategy
- "Determining Withdrawal Rates Using Historical Data"
Subscribe to:
Post Comments (Atom)
Popular Posts
-
I review the list of dividend increases as part of my monitoring process. I find it helpful to evaluate companies with a long streak of annu...
-
As part of my monitoring process, I review the list of dividend increases every week. I tend to focus my attention on the companies with a m...
-
A lot of times the best investment ideas are right under our noses . As individual investors and everyday consumers, we have an edge over Wa...
-
Opportunity costs represent the potential benefits an individual, investor, or business misses out on when choosing one alternative over ano...
-
As part of my weekly review process, I monitor the list of dividend increases and focus on the companies with at least a ten year history of...
-
I spend a lot of time looking for quality companies available at attractive valuations . Sometimes, I find a great company that fits my fund...
-
The Procter & Gamble Company (PG) provides branded consumer packaged goods to consumers in North and Latin America, Europe, the Asia Pac...
-
When stocks are volatile or start falling sharply. I start receiving an above average level of inquiries from readers, asking if now is the ...
-
The S&P Dividend Aristocrats index tracks companies in the S&P 500 that have increased dividends every year for at least 25 years...
-
Johnson & Johnson (JNJ), together with its subsidiaries, is engaged in the research and development, manufacture, and sale of various p...
Thanks for putting those 777 points into a better perspective DGI. The media loves to sensationalize days such as that with "worst ever", "biggest drop" just like when they have the market watch for whenever an index is about to break an all-time record high.
ReplyDelete