The B.I.G. blog always produces high quality research on the markets. This piece is about the magnitude of the stock market rally from the March lows put into historical context:
"It has been exactly nine months since the S&P 500 bottomed on March 9th at 676.53. Since then, the index has rallied 62%. Below we provide a chart of the rolling 9-month change (%) for the S&P 500 going back to 1928. As shown, 1933 was the only other time when the S&P 500 had a bigger 9-month gain. The 9-month period ending on May 12th, 1983 is the next best behind the current one with a gain of 60%. Also, the 9-month 62% gain was preceded by a 9-month decline of 51%. The only time that the index fell more over a 9-month period was in 1931/32 when it dropped 68%. " in Bespoke Investment Group Website
But this does not mean that the market has to sell off to correct itself. It can also go sideways and "correct" the extreme rolling 9-month change (%) on the S&P 500.
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