A Look At The SP 500 After A Tough Week

By: Richard Shaw | Mon, Feb 8, 2010
Print Email

The S&P 500 has grown over the 60+ years since 1947 at a rate of 6.8% through the March low of 2009, the same rate of growth of the GDP over the same period. If we take for the sake of argument that the GDP is an attractor value for the price growth level of the S&P 500, then the index would be expected to end 2010 at about 1055 (11 points, or 1%, below the close last Friday).

That GDP/S&P500 assumption is perhaps a false assumption, but the correlation seems reasonable from 1947 through the mid-1980's when interest rates began to fall dramatically, followed by the dot.com bubble. By ignoring the huge rise and fall, and rise again and fall again since the mid-1990's, the March 2009 low touched the 6.8% compound growth curve shown in the graph below ...

A Look At The S&P 500 After A Tough Week



Richard Shaw

Author: Richard Shaw

Richard Shaw

Richard Shaw

Disclaimer: Opinions expressed in this material and our disclosed positions are as of July 5, 2010. Our opinions and positions may change as subsequent conditions vary. We are a fee-only investment advisor, and are compensated only by our clients. We do not sell securities, and do not receive any form of revenue or incentive from any source other than directly from clients. We are not affiliated with any securities dealer, any fund, any fund sponsor or any company issuer of any security. All of our published material is for informational purposes only, and is not personal investment advice to any specific person for any particular purpose. We utilize information sources that we believe to be reliable, but do not warrant the accuracy of those sources or our analysis. Past performance is no guarantee of future performance, and there is no guarantee that any forecast will come to pass. Do not rely solely on this material when making an investment decision. Other factors may be important too. Investment involves risks of loss of capital. Consider seeking professional advice before implementing your portfolio ideas.

IMPORTANT NOTE: We are a Registered Investment Advisor. We do not sell investments or control client assets. We are professional advisors compensated on an hourly basis or flat fee basis for portfolio management or for our coaching advice. Clients for personal investment advice receive recommendations and guidance tailored to their specific needs. Newsletters and research publications, are not personal investment advice, are generic in nature and should not be interpreted as specific advice for any specific person or situation. In our research, we utilize information sources that we believe are reliable, but do not warrant the accuracy of those sources or our analysis. Research, data and opinions expressed on this site are for information purposes only, are general in character and are not advice specific to any individual investor.

Copyright 2008-2017 by QVM Group LLC All rights reserved.

All Images, XHTML Renderings, and Source Code Copyright © Safehaven.com