Stock market history

Investors have to use any kind of data while making their investment decisions. Any statistical, historical data can be of significance for investors.

Stock market history graph is also called historical stock market chart.  It is a graphical depiction of stock market. Graphical representations are always easy to understand for a layman then figures. These can be candlestick graphs or bar graphs. Most stock market graphs are in the OHLC format where O is opening price, H is the highest, L is the lowest and C stands for closing price. A historical graph can be valuable as it tells us about how the stock market has performed over a period of time and thus you can see a trend.

After one reads a stock market history graph of 20, 30 or 40 years, one can infer that stock market has moved in an upward direction, although after going through several setbacks. The over all trend of stock market has been up and there is no reason that it will continue to grow. So, the old adage “Invest and hold” can still be true for stock markets.

The Great Depression of the 1930s was a black period in the history of American stock market. Prior to Great depression, many common people had invested in the stock market without much knowledge. Some had to borrow money as they wanted to invest big amounts. The stock market crashed in 1929 and Dow Jones took almost 24 years to reach the same levels as 1929. The stock market history graph show that from 1922 to1929, people had made big money from stock markets as markets had a bull run. The markets dived when none expected it to. But in three years time the markets recovered and then again a bullish phase followed.

In 1970s the markets again dipped. It took 4 to 5 years for the market to rise again. For investors who must have invested with a long term perspective would have suffered huge losses.  The 70s market crash was not as terrible as the 1930’s. One can see that after the bearish phase, when the bull phase returns; that is the time when one can make lots of money.

After looking at the stock market history graph it becomes very clear that stock markets have their cycles. Every few years a new generation of investors go through the same cycle again. Investors can read these graphs and see if they can spot a trend. They can accordingly invest in the market by judging which phase are they in.