[Christian Harris]

Stock market corrections are a normal part of market cycles, typically lasting 3-5 months, with downturns averaging 115 days before reaching their lowest point.

Historically, recoveries take around 4 months, though deeper corrections (10%-20%) can extend to 8 months.

Corrections occur roughly every 1.2 to 1.7 years, making them shorter-lived and less severe than bear markets, which involve declines of 20% or more and can last significantly longer.

Since 1929, the S&P 500 has experienced 56 corrections, with only 22 escalating into bear markets.

The average peak-to-trough decline during a correction is 13.8%, compared to 35.6% for bear markets.

While corrections can feel unsettling, they’re often followed by swift recoveries—since World War II, the S&P 500 has taken an average of 4 months to bounce back after hitting its low.

For example, the last correction in late 2023 saw the S&P 500 drop 10.3% over three months, but it rebounded quickly, recovering within a single trading day.

Similarly, the 2022 correction, which briefly turned into a bear market, saw the index fall 25.4% before recovering over the following year.

What sets corrections apart from bear markets is their frequency and duration.

While corrections are relatively common, bear markets are rarer and more prolonged, with an average recovery time of over two years.

This distinction underscores the importance of maintaining a long-term perspective during market volatility.

Key Takeaways:

• Corrections are short-lived, averaging 3-5 months, with recoveries taking 4 months.
• They occur every 1.2 to 1.7 years, making them a regular feature of market cycles.
• Deeper corrections (10%-20%) may take 8 months to recover.
• Historically, the S&P 500 has experienced 56 corrections since 1929, with only 22 turning into bear markets.

What do you think—do you see this as a buying opportunity or are you waiting for more downside? 🤔📊

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