When stocks fall dramatically on one day the short-term losses can be scary.However the losses are wiped out and investors tend to earn a positive return over the following years. According to research by Schroders, the S&P 500 has delivered on an average 13.6% return annually in the five years following the worst ten days. The data sample used was as far back as 1988.
The table below shows the total return for the S&P 500 over one year and five years following the worst one day declines:
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Source: S&P’s 4% fall: How the stockmarket has performed after big one day losses, Schroders
Related ETF:
- SPDR S&P 500 ETF (SPY)
Disclosure: No Positions
