As the 10th anniversary of the climactic March 2009 market bottom arrives this week, many observers are focusing on all the ways this period since the global financial crisis has been extraordinary.
The worst economic shock in 75 years felled huge financial institutions, roiled international alliances and ushered in the most aggressive central-bank stimulus efforts ever seen, with zero or negative interest rates and purchases of trillions in securities becoming the norm worldwide.
Since the S&P 500 sank briefly to 666 on March 6, 2009, and reached its closing low of 676 three days later, the index has delivered a 10-year annualized total return of 17.8%
This neatly matches the annual gains (including dividends) posted by the S&P exactly 10 years after the October 1987 market crash (17.2%), and after the August 1982 bottom (17.6%), when the greatest modern bull market began. Even 10 years after the brutal bear-market trough of September 1974, the returns match up well: up 15.6% annualized through September 1984.
When the trailing 10-year return gets up to this area, it typically means a bull cycle is far along, but hasn't generally marked its end. If one had bought the S&P 500 when the trailing return was near its current level in 1984, 1992 or 1997, there was a bit of time before major declines (up to three years). Though the forward 10-year returns from those entry points were lower, they were positive (between 7% and 14% a year).
