1 Percent Down Day

jamesmith

Where Have All the 1 Percenters Gone?
Monday, February 6, 2012 at 12:31PM

The S&P 500's decline of 0.57% on January 26th has been its biggest down day so far this year.  The index hasn't seen a 1% decline since December 28th, which was 26 trading days ago.  In the first chart below, we show the number of trading days in between 1% down days since the start of 2009.  As shown, 26 trading days is the longest streak without a 1%+ decline in more than a year.



Below is the same chart as above showing the number of trading days in between 1%+ down days, except it goes back to 1980 instead of 2009.  As shown, the current streak of 26 trading days is barely a blip on this longer term chart.  In the 80s, 90s, and 2000s, there were dozens and dozens of streaks that were longer, with a few surpassing the 100-trading day mark.  While our experience over the short-term would suggest we may be "due" for a big down day, from a longer term perspective, there is plenty of precedent for a much longer streak to occur.   

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