9 March 2009: The bear market bottoms
The S&P 500 closed at 676.53, its lowest point of the financial crisis, down about 57% from its October 2007 peak. Few people were celebrating; headlines were full of bank failures and job losses. Yet this was the start of one of the longest bull markets in history. Investors who kept buying through the despair were richly rewarded. Those who sold that week locked in the loss.
The lesson: The market bottom tends to arrive when the news is at its worst, not when it improves.
What it meant for investors
$1,000 in S&P 500 index fund at the start of 2010 → $6,071 today, vs $6,071 in the S&P 500.
We start the clock at the start of 2010, the first year in our price data after the event. That is 6.1 times the money, but $0 less than a plain index fund made over the same years.
What S&P 500 index fund teaches: Owning the whole market removes the risk of picking the wrong company but not the risk of a lost decade, so time horizon matters as much as diversification.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2010 | $1,120 | $6,071 | $6,071 |
| 2012 | $1,280 | $5,312 | $5,312 |
| 2015 | $2,060 | $3,301 | $3,301 |
green = beat the S&P 500 · red = lost money
What if you bought S&P 500 index fund? Every starting year and the full story →
More S&P 500 index fund history
- 5 February 2018: Volmageddon: the Dow drops 1,175 points
- 19 February 2020: The S&P 500 hits a record before COVID
- 29 February 2020: The US reports its first COVID-19 death
- 3 March 2020: The Fed makes an emergency rate cut
- 6 March 2009: The S&P 500 touches 666
- 12 March 2020: Black Thursday: the worst day since 1987
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
Play Sixty-40