Where do you think this Market is going?

I am asked this question several times a week. Since I adjust to the market and do not predict it, let me give you a possible scenario. Volatility has returned, the S&P 500 has fallen more than 4% and the doomsayers and short sellers are expounding that the bubble has burst.

Now that we are back to within 1% of its all-time high their calls have been somewhat muted. I have no intention of trying to market time but I believe this market has a long way to run before the bulls stop making money.

There is no doubt that this bull market is getting mature and I don’t see a retirement plan for the bull forthcoming. The bull is now some 63 months old. That is longer than nine of the 15 bull markets since 1871.

However, it still has five more months to go until it is average in terms of length-and 41 months before it reaches the post-World War II average. Bull markets have been getting longer since the end of the War-a lot longer. Starting with the   beginning in1949, bull markets have lasted an average of 104 months or nearly 9 years. The current 5 years doesn’t seem so old, does it? There has been seven bull markets (including this one) since 1949 and the current one only places seventh in terms of length.

From the low in 2009 at 66.79, to the all-time high of 1897.28, the S&P has risen 185%. That is above the 163% average since 1871. However, the modern bull (since the end of WWII) has averaged 259% gains.

Three bull markets gained less than 100% while the other three were up 391%,414% and 516%, respectfully. Could the fact that the current one broke through the 100% barrier mean that it’s headed significantly higher?

This is just an observation but if the market simply performed according to ache average modern day bull market, it would last another 3 ½ years and rise 74%.

Bill

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About billriley

Chief Executive Officer, Chief Compliance Officer A co-founder and shareholder, William Riley is a 33 year industry veteran, who observed, many years ago, that over time institutional investors typically outperform individual investors while accepting less risk. In his role as Chief Executive Officer, Bill works tirelessly to make the wealth management strategies used by the world’s wealthiest families and largest institutions available to our firm’s individual clients. Bill combines fundamental and technical analysis to minimize investment portfolio risk and maximize potential returns. He uses a variety of non-correlated asset classes, including alternative investments, to minimize portfolio volatility and seek absolute returns in down or flat markets. Finally, Bill believes in a comprehensive approach to wealth management that fully coordinates and seamlessly integrates portfolio management, risk management and asset protection, trust, estate, tax and charitable planning. Prior to co-founding Riley Wealth Management ,LLC, Bill held management positions at Merrill Lynch, UBS, Raymond James, Paine Webber and J.C. Bradford. Bill founded Fort Worth branches for Raymond James and J.C. Bradford. Prior to entering the financial services industry, Bill ran his families closely held businesses. Bill’s experience operating family businesses combined with his wealth management experience makes him uniquely qualified to advise entrepreneurs and business owners on a variety of matters including complex and sensitive issues relating to business succession. Bill’s degrees and designations included a Masters Degree in Business Administration (MBA), the Chartered Financial Consultant designation (ChFC), the Chartered Life Underwriter designation (CLU) and the Wealth Management Specialist designation (WMS). A Fort Worth native, Bill is a TCU alum and active in many civic and charitable organizations. Bill and his wife, Marsha, now reside in Colleyville, and they have four grown children and four grandchildren. When he is not working on portfolios or studying financial markets, Bill can be found on the golf courses of Ridglea Country Club.
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