Still on Track for a Good Year
I’ve said many times in this space that the secret to weathering market volatility is leaving your account statements unopened more often. This may have saved many investors from downing the antacids last Friday.
The S&P 500 Index dropped 2.63% on June 5, placing it among the worst of the index’s daily returns over the past 30 years.1 That stinks. But what doesn’t stink is zooming out and seeing how strong the index’s performance has been. A cumulative return of 8.4% is a good start to the year considering the longer-term annualized return has been 10.6%.2
Most of us would have gladly signed up in advance for that type of performance over the first 112 trading days of 2026, especially if accompanied by the knowledge that we’d have an ongoing war as a backdrop. The ride has been bumpy, but that’s what distracts from the long-term view. If we had received the same cumulative return at a constant, smoothed delivery, imagine how thankful stock investors would be. And remember, tolerating the bumps is part of what earns you the equity premium.
So, sit back, ignore those pesky market update emails,3 and focus your attention on more important things, like catching up on Widow’s Bay episodes.
S&P 500 Index Year-to-Date as of June 5, 2026
Past performance is not a guarantee of future results. Actual investment returns may be lower.
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Footnotes
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1. Based on daily returns from June 10, 1996, to June 5, 2026.
2. Cumulative return is as of June 5, 2026. Long-term annualized return covers the period from January 1, 1996, to May 31, 2026.
3. Except Above the Fray.
Glossary
Equity premium: The return difference between stocks and a risk-free asset, such as short-term Treasury bills.
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