- In looking at all monthly closing levels between 1926 and 2021 for the S&P 500 Index, 30% of the monthly observations were new highs.
- After those highs, the average annualized compound returns ranged from over 14% one year later to more than 10% over the next five years. Those results were close to average returns over any given period of the same length.
Reaching a new high doesn’t mean the market will retreat. Stocks are priced to deliver a positive expected return for investors, so reaching record highs regularly is the outcome one would expect.