8 Minute Read

Tackle Today: A Tantalizing Question

August 27, 2021

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There’s a lesson in the answer


Yesterday we highlighted the S&P 500’s 20% year-to-date gain. Now for a question.

Which is more common – a down year or the S&P 500 rising 20%?

Keep in mind there’s about a 25% chance of a down year. One out of every four years, the market has declined. Surely a down year is more common than seeing stocks balloon 20%, right?


The S&P 500 has risen more than 20% in 34 of the past 95 years. That’s approximately 35% of the time. So while this year’s boom has been fantastic and likely perceived by rookies as rare, the reality is they come around quite often.

But if 20% gains are so common, why is the S&P 500’s average annual gain only 10%?

It’s because there has been some monster down years. This leads to the key takeaway. Stocks live at extremes: red-hot or ice-cold. Ironically, one of the least common years you’ll find in history is one where stocks gained 10%. Go figure.


Chart of the Day

Dick’s Sporting Goods (DKS)

Thursday’s stock swoon was powerless to stop the post-earnings ascent in DKS. The retail juggernaut gained 4.15% on another above-average trading session. The gains are well deserved. Dick’s destroyed its earnings numbers.

Video of the day

Buy One, Hold One, Dump One

Coach Greg analyzes 3 stocks from the Communications Sector – ViacomCBS, Fox, and Comcast – and asks the coaches which one they would Buy, Hold, and Dump, in this segment from Thursday’s Halftime Report

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