The Stock Market Is in Ultra-Rarified Territory and Doing Something for Only the 3rd Time in 154 Years -- and History Is Crystal Clear What Happens Next
One of Wall Street's rarest indicators has a pristine track record of forecasting future stock returns.
There are a lot of ways for investors to grow their wealth, including purchasing Treasury bonds, buying certificates of deposit from their local bank or credit union, acquiring real estate, or investing in commodities such as gold, silver, and oil. But none of these other asset classes has held a candle to the annualized return of stocks over the last century.
However, there's a catch to putting your money to work in the greatest wealth creator on the planet: Stocks are inherently volatile. Although the ageless Dow Jones Industrial Average (DJINDICES: ^DJI), benchmark S&P 500 (SNPINDEX: ^GSPC), and innovation-inspired Nasdaq Composite (NASDAQINDEX: ^IXIC) have all decisively risen over multiple decades, their performance over shorter timelines is no more certain than a coin flip.
Through the first five months of 2025, we've observed the broad-based S&P 500 launch to a fresh record closing high, which was followed by corrections in the Dow Jones and S&P 500 and the first bear market in three years for the Nasdaq Composite. In fact, a one-week period in April produced the fifth-biggest two-day percentage slide for the S&P 500 in 75 years, as well as the largest single-day nominal point gain in the index's history.
