At the close of trading today (August 22, 2018), the stock market will cross another milestone. It will set the record for the longest bull market in history.
A bull market begins when the market rises 20% from the low set at the end of the bear market. The last low set by the S&P 500 index was on March 9th, 2009. It's been 3,454 days since then. The previous record bull run was set between October 1990 and March 2000. This bull market hasn't been the strongest in history, even though it is now the longest. It has recorded the third largest total return of bull markets since the 1930s.
During the fallout of the Great Recession In February 2009, we did a client presentation titled, "The Case for the Next Bull Market." At that time, we were coming off a 50-70% market decline from the banking crises and unemployment was closing in on 10%. We made the case that the fundamentals for the market were structurally intact to have a strong recovery from those price levels. Little did we know that the next month would mark the start of the longest bull market cycle ever.
What does this mean for investors? The best advice we can give you is the same advice we gave when the Dow crossed 20,000 in January 2017. (By the way the Dow is now at 25,750 as I'm writing this article). Stay focused on YOUR financial goals. This advice will also hold true at Dow 30,000, the eventual end of this bull market, and any other market related milestones that may be reached during your lifetime.
We are not sure if the market will continue to set new records in the next few weeks or months, but we are confident that the market will continue to set new all-time highs in the future. Investing should not be about index returns, it is about attaining your long-term financial goals.
Bottom line: While you're likely to see headlines about the longest bull market in history, it shouldn't have any effect on your investment strategy.