The S&P 500 made new highs last week. You may ask yourself – what happens after a market makes a new high? The historical answer is more new highs! The chart below shows why it’s hard to time the market. As you can see from the dark blue bars, on average the market is up in every time period after it makes a new all time high. Obviously, it would be better to buy at the low of a market, but who’s to say when that may occur.

Source: Charlie Bilello

 

Now don’t get me wrong, it’s not all sunshine and rainbows when the market makes new highs. The chart below shows the historical draw-ups and drawdowns after the market has made a new high. As you can see, the ups (green) have been considerably more common and larger than the downs (yellow). However, there are a few significant moves that may require some antacids! Put on your seat belt.

 

 

I've also included a piece from our CIBC Economics team entitled "Monthly World Markets Report”.

 

As always, if you have any questions, please feel free to give us a call at any time.

 

Have a great weekend.

 

Milan