{"id":18836,"date":"2025-10-19T16:05:51","date_gmt":"2025-10-19T22:05:51","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=18836"},"modified":"2025-10-19T16:05:51","modified_gmt":"2025-10-19T22:05:51","slug":"3rd-year-in-a-row-of-double-digit-sp-500-returns","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=18836","title":{"rendered":"3rd Year in a Row of Double-Digit SP 500 Returns"},"content":{"rendered":"<p>With 10 weeks left in the 2025 calendar year, the SP 500 (total return) has returned +14.47% YTD, which places the key benchmark on track for its 3rd year in a row of double-digit returns, with 2023 and 2024 SP 500 returns being over 25% annually.<\/p>\n<ul>\n<li>2025: +14.40% YTD return for SP in 2025<\/li>\n<li>2024: +27.04%<\/li>\n<li>2023: +26.19%<\/li>\n<\/ul>\n<p>Historically, how often does this pattern happen ?<\/p>\n<p>According to this blog&#8217;s historical SP 500 return data, infrequently.<\/p>\n<p>The latest cluster was 2019 &#8211; 2021:<\/p>\n<ul>\n<li>2021: +28.75% return for SP 500<\/li>\n<li>2020: +18.2% return for SP 500<\/li>\n<li>2019: +31.8% return for SP 500<\/li>\n<\/ul>\n<p>Prior to that period, the longest cluster was the last 5 years of the 20th Century:<\/p>\n<ul>\n<li>1999: +21.04%<\/li>\n<li>1998: +28.58%<\/li>\n<li>1997: +33.36%<\/li>\n<li>1996: +22.96%<\/li>\n<li>1995: +37.58%<\/li>\n<\/ul>\n<p>Quick analysis: to my knowledge, there has never been 5 years in a row of SP 500 returns like the period from 1995 to 1999, but this blog&#8217;s data only goes back to 1970. That &#8211; I believe &#8211; is truly an unprecedented period of annual SP 500 returns.<\/p>\n<p>2023 &#8211; 2025 instance and the 2019 &#8211; 2021 instance are slightly more common with +20% returns accompanied by a mid-teens annual return.<\/p>\n<p>What&#8217;s the point of the article ? Like <a href=\"https:\/\/fundamentalis.com\/?p=17186\">this<\/a> late 2024 blog post about longer-term SP 500 stock returns, I thought 2025 might be a year of &#8220;PE compression&#8221; since the SP 500 EPS growth in 2023 and 2024 was only +2% in 2023 and +10% in 2024, yet the SP 500 returned 53% cumulatively over the 2 years.<\/p>\n<p>The point being this blog&#8217;s 2025 SP 500 return forecast was too conservative, and I wasn&#8217;t expecting a +14% YTD return by November &#8217;25.<\/p>\n<p>Depending on how the last 10 weeks of the year progresses, the probability is growing that 2026 or 2027 is a more difficult year for investors.<\/p>\n<p>The 5 years at the end of the late 1990&#8217;s was followed by a 50% correction in the SP 500, and an 80% correction in the Nasdaq beginning March, 2000 to March, 2003, and the three-year period following Covid was followed by 2022, when the SP 500 fell 18% and the Barclay&#8217;s Aggregate fell 13%.<\/p>\n<p>What&#8217;s unspoken about these return patterns is that given current estimates today, 2026 is likely to see 14% EPS growth for the SP 500, which was written about <a href=\"https:\/\/fundamentalis.com\/?p=18636\">here<\/a> on September 12th, 2025, which means we could very likely see a year of &#8220;PE compression&#8221; which means SP 500 earnings growth will be mid-teens, and the SP 500 could be something less, like 5% &#8211; 10% or even slightly negative, depending on the &#8220;macro&#8221;.<\/p>\n<p><em><strong>Summary \/ conclusion:<\/strong><\/em> After a 15-year secular bull market in stocks (mainly the SP 500 and the Nasdaq), I thought it was worth pointing out these patterns to readers that have emerged over the last 30 &#8211; 40 years.<\/p>\n<p>Since 1970, the SP 500 has averaged 12.43% per year over those 55 years. When we get a series of consecutive years above that average, the probability improves that investors will likely see a year that is below (or well-below) that average.<\/p>\n<p>2025&#8217;s SP 500 total return is better than I thought it would be a year ago, with two consecutive years of +25% returns.<\/p>\n<p>None of this is advice or a recommendation, but only an opinion. Past performance is no guarantee of future results. None of the information posted today may be updated, and if updated, may not be done in a timely fashion.<\/p>\n<p>Thanks for reading.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>With 10 weeks left in the 2025 calendar year, the SP 500 (total return) has returned +14.47% YTD, which places&hellip;<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[308],"tags":[],"class_list":["post-18836","post","type-post","status-publish","format-standard","hentry","category-sp-500-annual-return"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/18836","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18836"}],"version-history":[{"count":10,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/18836\/revisions"}],"predecessor-version":[{"id":18847,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/18836\/revisions\/18847"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18836"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18836"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18836"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}