S&P 500 since 1950 – graph showing all crashes

by Semcast

S&P 500 Since 1950 – 7 crashes

Hi guys just wanted to put things in perspective for you all since some of you seem to be quite nervous with the recent week of stock movement.

I’ve summarised a list all stock market crashes since 1950. There has been 7 stock market crashes since 1950, averaging one every 10 years.

The stock market crashes ranges from inflation (10%+), to oil price rises (4x) due to war, dot com bubble, housing market collapse, covid-19 etc.

The graph is a log graph meaning that the space changes are proportional to the percentage change. This is useful for looking at long term charts since the % change for a dollar increase is smaller as the index value goes up.

The S&P 500 has averaged a compound annual growth rate of 8.22% since 1950. This is illustrated by the trend lines, and as you can see the S&P 500 is trading right in the middle of the range (the two blue trend lines).

I noted a few reasons in the box for each crash for a brief understanding of why it had happened. Note, that the only one with a ‘fear of overvaluation’ was only the dotcom crash where the PE’s were over 200 and many companies were just cash burning shells with massive negative free cash flows.

I’m not saying a crash / correction won’t happen, but i just wanted to put things into perspective and give a bigger picture of the overall stock market since pretty much before all of us were born.

By no means am i an economist but I didn’t include anything earlier than 1950s because that was pre WW2/WW1 – before the US was a superpower / the global financial hub / USD = world trade currency etc.


Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.


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