The S&P 500 index (SNPINDEX: ^GSPC) is near all-time highs right now. However, the world’s preeminent stock market benchmark doesn’t go up and to the right in a smooth and straight line. There is volatility that investors must deal with. And equity prices can be in down cycles for long periods of time.
But it always pays to adopt a long-term mentality. If you’d invested $10,000 in an S&P 500 exchange-traded fund (ETF) during the last bear market, here’s how much you’d have today.
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The most recent bear market lasted from early January 2022 to mid-October of that year. Let’s say you purchased $10,000 in an S&P 500 ETF on Jan. 3, 2022, the absolute worst time just before the market started its descent. As of Sept. 28, you’d have captured a 73% total return, growing that starting capital to $17,300.
This clearly demonstrates that even if you put money to work at record highs, the market can reward you with sizable gains.
Now let’s assume that you were able to precisely time your buy. If you purchased an S&P 500 ETF on Oct. 12, 2022, before the market began to rise, a $10,000 initial investment would be worth $22,900, equating to a total return of 129%.
The takeaway from this performance is that buying the dip can be incredibly lucrative.
Should you buy stock in S&P 500 Index right now?
Before you buy stock in S&P 500 Index, consider this:
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Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $379,123!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,396,103!*
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
If You’d Invested $10,000 in an S&P 500 ETF During the Last Bear Market, Here’s How Much You’d Have Today was originally published by The Motley Fool