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Wall Street History
https://www.gofundme.com/s3h2w8
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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 it’s 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 Advisors’ 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 Trader’s Almanac / 2005
Wall Street History will return 11/19.
Brian Trumbore
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