Intra Year Market Declines

March 6, 2025

It’s been a fascinating start to 2025 when looking at the stock market. Although there has been a bit of volatility of late, it’s all a normal and expected part of investing. In fact, despite the flashing red signs on your news outlet of choice, the market has largely moved… sideways.

Here are the year-to-date returns as of closing bell March 5th for the three major indexes:

• Dow Jones Industrial Average (+1.45%)
• S&P 500 (-0.44%)
• NASDAQ (-3.78%)

You might have heard that the NASDAQ briefly touched correction territory earlier this week. A stock market correction is generally defined as a drop of 10% or more from a recent high.

This got me thinking about what intra year drawdowns look like. An intra year drawdown is measured as the largest market decline in a calendar year from peak to trough.

Dating back to 1980, the average S&P 500 intra year drawdown is 14.1%. In 34 of those 45 years, the S&P 500 has finished with positive returns (calculated as percentage price change without dividends reinvested).

For simplicity, I've rounded drawdowns and returns to the nearest whole percentage. The below can be read as follows…

Year: Max Drawdown | Annual Return

• 1980: -17% | +26%
• 1981: -18% | -10%
• 1982: -17% | +15%
• 1983: -7% | +17%
• 1984: -13% | +1%
• 1985: -8% | +26%
• 1986: -9% | +15%
• 1987: -34% | +2%
• 1988: -8% | +12%
• 1989: -8% | +27%
• 1990: -20% | -7%
• 1991: -6% | +26%
• 1992: -6% | +4%
• 1993: -5% | +7%
• 1994: -9% | -2%
• 1995: -3% | +34%
• 1996: -8% | +20%
• 1997: -11% | +31%
• 1998: -19% | +27%
• 1999: -12% | +20%
• 2000: -17% | -10%
• 2001: -30% | -13%
• 2002: -34% | -23%
• 2003: -14% | +26%
• 2004: -8% | +9%
• 2005: -7% | +3%
• 2006: -8% | +14%
• 2007: -10% | +4%
• 2008: -49% | -38%
• 2009: -28% | +23%
• 2010: -16% | +13%
• 2011: -19% | +0%
• 2012: -10% | +13%
• 2013: -6% | +30%
• 2014: -7% | +11%
• 2015: -12% | -1%
• 2016: -11% | +10%
• 2017: -3% | +19%
• 2018: -20% | -6%
• 2019: -7% | +29%
• 2020: -34% | +16%
• 2021: -5% | +27%
• 2022: -25% | -19%
• 2023: -10% | +24%
• 2024: -8% | +23%

This is your friendly reminder that despite any short-term market movement in response to political policies or posturing, the stock market has handsomely rewarded investors over the long-term. Stay the course.

- Chris McKeown

Sources: MacroTrends, S&P 500 Historical Annual Returns (https://www.macrotrends.net/2526/sp-500-historical-annual-returns); Yahoo Finance, S&P 500 Index Daily Return Data (https://finance.yahoo.com/quote/%5ESPX/history/).