Have markets partied too hard? With world and US stocks up 18.2 per cent and 23.7 per cent, respectively, year to date through to October 29, wrong-headed bears see above-average gains as signs stocks are overheated.
Wrong! Strong returns aren’t barriers to more good times. These returns, as I will show you, are smack dab average.
Investing is error-prone. Anchoring to long-term average returns is a big one. When stocks outrun the S&P 500’s annualised average – about 10 per cent in USD – folks get twitchy. They presume worse ahead to revert returns back to average. Big upside must cap future gains!
But consensus concepts of “average” don’t imply frequent. The S&P 500 usually returns far higher or lower than that. Averages blend together volatile extremes, combining mostly big positives with fewer negatives.
Long term, average returns aren’t normal – extreme returns are. Hence, current strength is shockingly normal. Whatever stocks do now, through 2025, good or bad, won’t be because of returns year to date.
Stocks rise big far more often than fall. Using America’s S&P 500 for its global importance and longest accurate history, since 1925, stocks gained in fully 75.2 per cent of all rolling 12-month periods through September (in USD).
Yet, returns are often wild year to year. To see that, bracket together calendar year returns into ranges: exceeding 20 per cent, 0 to 20 per cent gains, 0 to -20 per cent declines and -20 per cent or uglier.
Since 1925, US stocks rose big – above 20 per cent – in 37 of 98 years – the most common result! Next most frequent? Up less. Zero to 20 per cent gains happened 35 times.
Negative years – down between 0 and -20 per cent – were less common – 20 times. And down more than -20 per cent? That occurred just six times. So, US markets posted huge gains six times more often than big declines!
Alternately, US stocks beat their 10 per cent long-term average in USD in 58 of 98 calendar years. They fell – at all – less than half as often, 26 times. That makes 2024’s big year-to-date returns start to look more common, less curious.
Long-term average returns are quite rare. Consider recent history. US stocks haven’t gained between 5 per cent and 15 per cent since 2016. Overall, it happened in just 17 per cent of S&P 500 years since 1925. Hence, that “average” year happens only once of every six years!
Recently, many fixated upon 2022’s negativity. But what of 2019’s 31.5 per cent S&P 500 USD boom. Or 2021’s 28.7 per cent climb. Or 2023’s 26.3 per cent jump. All were “extreme”. Ironically, 2020 was the closest to “average” in that stretch, as US stocks rose 18.4 per cent.
But would you call anything about 2020 nearly “average” or “normal?” No. The S&P 500 plunged 33.8 per cent in USD from February 19 through March 23 amid Covid lockdowns. Hardly “normal”! Then it soared 70.2 per cent from the March low through year end. Also extreme! The cumulative 18.4 per cent return feels slightly above average but masks a wild ride.
Whether you are in a bull or bear market makes a huge difference as to what sort of returns you might normally expect. In bull markets, stocks rise and by definition must be commonly above average.
In a bear market, they fall – below average. Sounds childishly obvious. It isn’t. Few ever stop to think: “I’m in a bull market, so returns should average far above long-term average returns.”
Most investors cling to that average return for all years, making bull market gains look too big, too fast. Nearly every bull market features such fears. But big returns in bull markets are “normal”.
US stocks’ roughly 10 per cent long-term annualised average includes all bear markets, even the worst of the worst. To outstrip the massive down years and reach that 10 per cent annual average, the up years must be way, way up.
Hence bull markets alone have averaged 23 per cent annualised – a fact few seem to even know. Note: 2024’s 23.7 per cent result, so far, is right there, smack dab on that average – nothing more.
Seemingly “extreme” positives within bull markets underpin the “average” returns bears latch on to.
Not that 2025 is a sure-fire winner. Falling uncertainty after America’s election should power returns near-term, but risks could lurk later.
I’ll address that here month to month ahead. But those risks don’t include 2024’s big returns. And the backdrop has plenty of positives, too. If bad times await, it will be because new, unpriced risks outweigh those positives, not because this year was too hot.
Regardless, when you realise robust gains aren’t abnormal, you see “too far, too fast” fears are faulty. The climb in 2024 is terrifically typical.
Ken Fisher is the founder, executive chairman and co-chief investment officer of Fisher Investments, a global investment adviser with $285 billion of assets under management
COMPANY%20PROFILE
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THE%20SWIMMERS
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The full list of 2020 Brit Award nominees (winners in bold):
British group
Coldplay
Foals
Bring me the Horizon
D-Block Europe
Bastille
British Female
Mabel
Freya Ridings
FKA Twigs
Charli xcx
Mahalia
British male
Harry Styles
Lewis Capaldi
Dave
Michael Kiwanuka
Stormzy
Best new artist
Aitch
Lewis Capaldi
Dave
Mabel
Sam Fender
Best song
Ed Sheeran and Justin Bieber - I Don’t Care
Mabel - Don’t Call Me Up
Calvin Harrison and Rag’n’Bone Man - Giant
Dave - Location
Mark Ronson feat. Miley Cyrus - Nothing Breaks Like A Heart
AJ Tracey - Ladbroke Grove
Lewis Capaldi - Someone you Loved
Tom Walker - Just You and I
Sam Smith and Normani - Dancing with a Stranger
Stormzy - Vossi Bop
International female
Ariana Grande
Billie Eilish
Camila Cabello
Lana Del Rey
Lizzo
International male
Bruce Springsteen
Burna Boy
Tyler, The Creator
Dermot Kennedy
Post Malone
Best album
Stormzy - Heavy is the Head
Michael Kiwanuka - Kiwanuka
Lewis Capaldi - Divinely Uninspired to a Hellish Extent
Dave - Psychodrama
Harry Styles - Fine Line
Rising star
Celeste
Joy Crookes
beabadoobee
It Was Just an Accident
Director: Jafar Panahi
Stars: Vahid Mobasseri, Mariam Afshari, Ebrahim Azizi, Hadis Pakbaten, Majid Panahi, Mohamad Ali Elyasmehr
Rating: 4/5
The essentials
What: Emirates Airline Festival of Literature
When: Friday until March 9
Where: All main sessions are held in the InterContinental Dubai Festival City
Price: Sessions range from free entry to Dh125 tickets, with the exception of special events.
Hot Tip: If waiting for your book to be signed looks like it will be timeconsuming, ask the festival’s bookstore if they have pre-signed copies of the book you’re looking for. They should have a bunch from some of the festival’s biggest guest authors.
Information: www.emirateslitfest.com
UAE currency: the story behind the money in your pockets
Desert Warrior
Starring: Anthony Mackie, Aiysha Hart, Ben Kingsley
Director: Rupert Wyatt
Rating: 3/5
More from Rashmee Roshan Lall
UAE currency: the story behind the money in your pockets
The specs
BMW M8 Competition Coupe
Engine 4.4-litre twin-turbo V8
Power 625hp at 6,000rpm
Torque 750Nm from 1,800-5,800rpm
Gearbox Eight-speed paddleshift auto
Acceleration 0-100kph in 3.2 sec
Top speed 305kph
Fuel economy, combined 10.6L / 100km
Price from Dh700,000 (estimate)
On sale Jan/Feb 2020
LA LIGA FIXTURES
Friday (UAE kick-off times)
Real Sociedad v Leganes (midnight)
Saturday
Alaves v Real Valladolid (4pm)
Valencia v Granada (7pm)
Eibar v Real Madrid (9.30pm)
Barcelona v Celta Vigo (midnight)
Sunday
Real Mallorca v Villarreal (3pm)
Athletic Bilbao v Levante (5pm)
Atletico Madrid v Espanyol (7pm)
Getafe v Osasuna (9.30pm)
Real Betis v Sevilla (midnight)
Tales of Yusuf Tadros
Adel Esmat (translated by Mandy McClure)
Hoopoe
How much do leading UAE’s UK curriculum schools charge for Year 6?
- Nord Anglia International School (Dubai) – Dh85,032
- Kings School Al Barsha (Dubai) – Dh71,905
- Brighton College Abu Dhabi - Dh68,560
- Jumeirah English Speaking School (Dubai) – Dh59,728
- Gems Wellington International School – Dubai Branch – Dh58,488
- The British School Al Khubairat (Abu Dhabi) - Dh54,170
- Dubai English Speaking School – Dh51,269
*Annual tuition fees covering the 2024/2025 academic year
Tightening the screw on rogue recruiters
The UAE overhauled the procedure to recruit housemaids and domestic workers with a law in 2017 to protect low-income labour from being exploited.
Only recruitment companies authorised by the government are permitted as part of Tadbeer, a network of labour ministry-regulated centres.
A contract must be drawn up for domestic workers, the wages and job offer clearly stating the nature of work.
The contract stating the wages, work entailed and accommodation must be sent to the employee in their home country before they depart for the UAE.
The contract will be signed by the employer and employee when the domestic worker arrives in the UAE.
Only recruitment agencies registered with the ministry can undertake recruitment and employment applications for domestic workers.
Penalties for illegal recruitment in the UAE include fines of up to Dh100,000 and imprisonment
But agents not authorised by the government sidestep the law by illegally getting women into the country on visit visas.
HOW TO WATCH
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So what is Spicy Chickenjoy?
Just as McDonald’s has the Big Mac, Jollibee has Spicy Chickenjoy – a piece of fried chicken that’s crispy and spicy on the outside and comes with a side of spaghetti, all covered in tomato sauce and topped with sausage slices and ground beef. It sounds like a recipe that a child would come up with, but perhaps that’s the point – a flavourbomb combination of cheap comfort foods. Chickenjoy is Jollibee’s best-selling product in every country in which it has a presence.
Classification of skills
A worker is categorised as skilled by the MOHRE based on nine levels given in the International Standard Classification of Occupations (ISCO) issued by the International Labour Organisation.
A skilled worker would be someone at a professional level (levels 1 – 5) which includes managers, professionals, technicians and associate professionals, clerical support workers, and service and sales workers.
The worker must also have an attested educational certificate higher than secondary or an equivalent certification, and earn a monthly salary of at least Dh4,000.
Trump v Khan
2016: Feud begins after Khan criticised Trump’s proposed Muslim travel ban to US
2017: Trump criticises Khan’s ‘no reason to be alarmed’ response to London Bridge terror attacks
2019: Trump calls Khan a “stone cold loser” before first state visit
2019: Trump tweets about “Khan’s Londonistan”, calling him “a national disgrace”
2022: Khan’s office attributes rise in Islamophobic abuse against the major to hostility stoked during Trump’s presidency
July 2025 During a golfing trip to Scotland, Trump calls Khan “a nasty person”
Sept 2025 Trump blames Khan for London’s “stabbings and the dirt and the filth”.
Dec 2025 Trump suggests migrants got Khan elected, calls him a “horrible, vicious, disgusting mayor”
if you go
The flights
Etihad, Emirates and Singapore Airlines fly direct from the UAE to Singapore from Dh2,265 return including taxes. The flight takes about 7 hours.
The hotel
Rooms at the M Social Singapore cost from SG $179 (Dh488) per night including taxes.
The tour
Makan Makan Walking group tours costs from SG $90 (Dh245) per person for about three hours. Tailor-made tours can be arranged. For details go to www.woknstroll.com.sg
More from Neighbourhood Watch:
UK’s AI plan
- AI ambassadors such as MIT economist Simon Johnson, Monzo cofounder Tom Blomfield and Google DeepMind’s Raia Hadsell
- £10bn AI growth zone in South Wales to create 5,000 jobs
- £100m of government support for startups building AI hardware products
- £250m to train new AI models
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
MORE ON TURKEY'S SYRIA OFFENCE
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Dust and sand storms compared
Sand storm
- Particle size: Larger, heavier sand grains
- Visibility: Often dramatic with thick "walls" of sand
- Duration: Short-lived, typically localised
- Travel distance: Limited
- Source: Open desert areas with strong winds
Dust storm
- Particle size: Much finer, lightweight particles
- Visibility: Hazy skies but less intense
- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
Key findings of Jenkins report
- Founder of the Muslim Brotherhood, Hassan al Banna, "accepted the political utility of violence"
- Views of key Muslim Brotherhood ideologue, Sayyid Qutb, have “consistently been understood” as permitting “the use of extreme violence in the pursuit of the perfect Islamic society” and “never been institutionally disowned” by the movement.
- Muslim Brotherhood at all levels has repeatedly defended Hamas attacks against Israel, including the use of suicide bombers and the killing of civilians.
- Laying out the report in the House of Commons, David Cameron told MPs: "The main findings of the review support the conclusion that membership of, association with, or influence by the Muslim Brotherhood should be considered as a possible indicator of extremism."
No%20Windmills%20in%20Basra
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