A Stock Market Correction Could Be Coming. Here's What 100 Years of Data Says Happens Next.

The S&P 500 has risen much than 30% implicit the past 12 months and presently trades adjacent its all-time high. However, it looks historically costly astatine 31 times net -- truthful investors shouldn't beryllium amazed if those valuations chill disconnected and the marketplace pulls back. On the agleam side, the information from the past 100 years indicates the marketplace volition easy bounce backmost -- truthful you shouldn't hastily merchantability the Vanguard S&P 500 ETF (NYSEMKT: VOO) oregon different index-tracking ETFs yet.

What happened implicit the past 100 years?

The modern S&P 500, which includes the 500 astir salient companies successful the United States, was created connected March 4, 1957. Since its inception, it's risen astir 14,830%.

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Its predecessor, the Standard Statistics Index, was created successful 1923 arsenic an scale of 233 stocks. In 1926, it was expanded into a broader composite scale with regular calculations. Most semipermanent charts of the S&P 500 see the returns of its predecessor, which preceded its 1957 launch.

Including those earlier returns, the S&P 500 rallied 56,780% implicit the past century, turning a $1,000 concern (equivalent to $18,656 today) into $568,800. That easy outpaced the 1,766% ostentation complaint implicit those 100 years -- adjacent arsenic the satellite endured 2 satellite wars, the Great Depression, and 5 planetary recessions since World War II.

While past show ne'er guarantees aboriginal gains, the banal market's resilience is intolerable to ignore. It could endure achy multi-year declines, but it volition support rising arsenic the U.S. system expands and the stronger companies regenerate the weaker ones. In different words, it's smarter to either bash thing oregon bargain much stocks erstwhile the adjacent marketplace clang happens.

Should you bargain banal successful Vanguard S&P 500 ETF close now?

Before you bargain banal successful Vanguard S&P 500 ETF, see this:

The Motley Fool Stock Advisor expert squad conscionable identified what they judge are the 10 champion stocks for investors to bargain now… and Vanguard S&P 500 ETF wasn’t 1 of them. The 10 stocks that made the chopped could nutrient monster returns successful the coming years.

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