Many investors were shaken out of their positions in April as the stock market plunged on tariff and inflation fears. However, both the S&P 500 ETF (SPY) and the Nasdaq 100 ETF (QQQ) have mounted incredible comebacks and are up by 26% and 34%, respectively, since April 8.
Don’t Miss TipRanks’ Half-Year Sale
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
- Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
The “lockout rally”, or a surge in price in which many people are too scared to buy in given concerns about the economy, has resulted in many investors missing out on elevated gains. So, with the market at all-time highs, is it too late to buy?
Buying the S&P 500 on a Record-High Day Pays Off
Buying the S&P 500 on a record-high day offers greater long-term performance than buying on any other day, according to data from J.P. Morgan.
Buying the benchmark index on a record-high day yields a three-month return of 2.3% and a six-month return of 5.9%. Buying the index on any other day provides a three-month return of 2.9% and a six-month return of 5.8%.
The outperformance of buying on a record-high day increases as the time period lengthens. The one-year return for buying at a record-high is 13.4% compared to 11.9% for any other day. The three-year return for buying at a record-high is 48.1% compared to 40.2%. And for five years out? 79.6% compared to 73.8%.
In other words, it isn’t too late to join in on the rally.
The S&P 500 (SPX) has returned 6.76% year-to-date.
