The rewarding distribution of US stock market returns

January 31, 2025

Annual stock market returns are unpredictable, but the long history of positive returns may be reassuring to investors who find market downturns unsettling.

“Up” years have occurred much more frequently than “down” years in the US stock market from 1926 through 2023.
The market averaged gains of 10.0% per year during this period.
About two-thirds of the down years were followed by up years. The most recent example: a 19.8% loss in 2022 followed by a 26.6% gain in 2023.

What’s the conclusion? The stock market tends to reward investors who can weather annual ups and downs and stay committed to a long-term plan.

Source: Dimensional Fund Advisors. In USD. Return in 1970 was 0.002%. CRSP data provided by the Center for Research in Security Prices, University of Chicago. The CRSP 1–10 Index measures the performance of the total US stock market, which it defines as the aggregate capitalization of all US securities listed on the NYSE, NYSE MKT (formerly AMEX), and Nasdaq Global Market.

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The commentary in this post (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of Tim Corriero, an Investment Adviser Representative of Gemmer Asset Management LLC (“GAM”) and should not be regarded as the views of GAM, or a description of advisory services provided by GAM or performance returns of any GAM client. References to securities or market-related performance data are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Any mention of a specific law firm herein does not constitute an endorsement, recommendation, or favoring by such firm.

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Tim Corriero, J.D, CFP ©

Tim Corriero is an attorney, a Certified Financial Planner ® and founder of Juris Wealth, a financial advisory business for lawyers.

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*Timothy Corriero, represented under the tradenames “Juris Wealth” and “The JD Investor”, is an Investment Advisor Representative of Gemmer Asset Management LLC (“GAM”), an investment adviser registered with the Securities and Exchange Commission that maintains its principal place of business located in Walnut Creek, California. Registration does not imply a certain level of skill or training. The JD Investor does not provide investment advisory services. It is a website/blog dedicated to educating and informing investors. See disclosures. Please refer to GAM’s Client Relationship Summary (Form CRS) or visit adviserinfo.sec.gov for additional information.