Fear always lurks in the background when individual investors approach the stock market. After all, it is a scary proposition to put your money someplace that has the potential of losing a great deal within any one-year span.
Not to worry: 189 years of U.S. stock market history shows that investors can expect to do well about two-thirds of the time. Using statistics going back to 1825, the chief market technician at Carter Braxton Worth found that the U.S. market rose 71 percent of the time, or 134 calendar years, according to MarketWatch.com.
The market fell just 29 percent of the time. Yes, some of those declines can be spectacular, like the 43 percent drop in the Standard & Poor’s 500 Index in 1931. But they can be equally spectacular, as in the 53 percent increase in 1954.
On the whole, investors who hold widely diversified stock portfolios through thick and thin have a good chance of reaping a positive return after inflation.
Richard Schroeder CFP®, March 2, 2015