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Wall Street History

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11/12/2004

Stocks: The Year After

Equity returns in post-election years; as measured by the S&P
500, the Ibbotson small cap index (S/C, as defined below) and
the Nasdaq (since itís inception in 1971).

..S&P S/C ..N

2001 (R) ..-11.9 ..+22.8 -21.1

1997 (D) ..+33.4 ..+22.8 ..+21.6

1993 (D) ..+10.0 ..+21.0 ..+14.7

1989 (R) ..+31.5 ..+10.2 ..+19.3

1985 (R) ..+32.2 ..+24.7 ..+31.4

1981 (R) -4.9 ..+13.9 -3.2

1977 (D) -7.2 ..+25.4 +7.3

1973 (R) ..-14.7 ..-30.9 -31.1

1969 (R) -8.5 ..-25.1

1965 (D) ..+12.5 .+41.8

1961 (D) ..+26.9 .+32.1

1957 (R) ..-10.8 ..-14.6

1953 (R) -1.0 .-6.5

1949 (D) ..+18.8 ..+19.8

1945 (D) ..+36.4 ..+73.6

1941 (D) ..-11.6 .-9.0

1937 (D) ..-35.0 ..-58.0

1933 (D) ..+54.0 +142.9

1929 (R) -8.4 ..-51.4

Notes:

--In calculating small cap returns, Ibbotson Associates has
employed various indices since 1926; namely the fifth
capitalization quintile of stocks on the New York Stock
Exchange for 1926-81, Dimensional Fund Advisorsí Small
Company Fund, 1982-2001, and, since April 2001, the DFA
Micro Cap Fund.

--The small cap return figures for 1997 and 2001 were indeed
exactly the same, +22.8.

But concerning 2001, yes, the small cap return for this year may
seem strange when weighed against the performance of large
caps, as represented by the S&P and Nasdaq. Remember the
environment back then the big names that had all the volume in
1998-2000 were being sold with a vengeance. The smaller
stocks, such as defined above, obviously held up better.

Nonetheless, I went through the numbers with a fine tooth comb
to convince myself.

For example, here are the returns for just two months in 2001.

January S/C +13.8 S&P +3.6 Nasdaq +12.2
May .S/C +9.6 .S&P +0.7 Nasdaq -0.3

[Using one other month, 2/01, the Nasdaq was off 22.4% while
the Ibbotson small cap index was off 7%]

--One other note, the 142.9% return figure for small caps in 1933
is not a typo.

Sources:

Ibbotson Associates 2004 Yearbook
Stock Traderís Almanac / 2005

Wall Street History will return 11/19.

Brian Trumbore



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-11/12/2004-      
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Wall Street History

11/12/2004

Stocks: The Year After

Equity returns in post-election years; as measured by the S&P
500, the Ibbotson small cap index (S/C, as defined below) and
the Nasdaq (since itís inception in 1971).

..S&P S/C ..N

2001 (R) ..-11.9 ..+22.8 -21.1

1997 (D) ..+33.4 ..+22.8 ..+21.6

1993 (D) ..+10.0 ..+21.0 ..+14.7

1989 (R) ..+31.5 ..+10.2 ..+19.3

1985 (R) ..+32.2 ..+24.7 ..+31.4

1981 (R) -4.9 ..+13.9 -3.2

1977 (D) -7.2 ..+25.4 +7.3

1973 (R) ..-14.7 ..-30.9 -31.1

1969 (R) -8.5 ..-25.1

1965 (D) ..+12.5 .+41.8

1961 (D) ..+26.9 .+32.1

1957 (R) ..-10.8 ..-14.6

1953 (R) -1.0 .-6.5

1949 (D) ..+18.8 ..+19.8

1945 (D) ..+36.4 ..+73.6

1941 (D) ..-11.6 .-9.0

1937 (D) ..-35.0 ..-58.0

1933 (D) ..+54.0 +142.9

1929 (R) -8.4 ..-51.4

Notes:

--In calculating small cap returns, Ibbotson Associates has
employed various indices since 1926; namely the fifth
capitalization quintile of stocks on the New York Stock
Exchange for 1926-81, Dimensional Fund Advisorsí Small
Company Fund, 1982-2001, and, since April 2001, the DFA
Micro Cap Fund.

--The small cap return figures for 1997 and 2001 were indeed
exactly the same, +22.8.

But concerning 2001, yes, the small cap return for this year may
seem strange when weighed against the performance of large
caps, as represented by the S&P and Nasdaq. Remember the
environment back then the big names that had all the volume in
1998-2000 were being sold with a vengeance. The smaller
stocks, such as defined above, obviously held up better.

Nonetheless, I went through the numbers with a fine tooth comb
to convince myself.

For example, here are the returns for just two months in 2001.

January S/C +13.8 S&P +3.6 Nasdaq +12.2
May .S/C +9.6 .S&P +0.7 Nasdaq -0.3

[Using one other month, 2/01, the Nasdaq was off 22.4% while
the Ibbotson small cap index was off 7%]

--One other note, the 142.9% return figure for small caps in 1933
is not a typo.

Sources:

Ibbotson Associates 2004 Yearbook
Stock Traderís Almanac / 2005

Wall Street History will return 11/19.

Brian Trumbore