Average Daily Market Move Back Below 1%

The S&P 500 has had just two 1% days so far this year, and they have both been positive 1% days.  The biggest down day for the index is still just -0.57% on January 26th.  The huge drop in volatility is surely a welcome relief for most investors.  Last October, 15 of the 21 trading days during the month were 1%+ days.

Below is a chart highlighting the 50-day average absolute daily % change for the S&P 500 going back to 2002.  Over the last 50 days, the index has averaged a daily change of +/-0.79%.  As shown, the reading has dropped by more than half from the high of 1.92% seen just a few months ago. 

It's still crazy to look at this chart and see just how volatile things got back in late 2008/early 2009.  Last year's volatility, while rough, was nothing compared to what we saw during the financial crisis.  At one point in early December 2008, the S&P 500 had averaged a daily change of +/-4.02% over the prior 50 days, which is the highest level ever seen in the index's history.  With the entire US stock market swinging an average of 4% on a daily basis for more than two months, it's no wonder that individual investors are still having a tough time dipping their toes back in the water, even three years later.

Subscribe to Bespoke Premium for the most in-depth earnings season analysis around.