This week a look at some timeless charts from the past couple of years
Welcome to the Weekly S&P500$S&P 500(.SPX)$ #ChartStorm— a selection of 10 charts which I hand pick from around the web and post on Twitter$Twitter(TWTR)$ .
This week it’s a slightly different focus than usual given the quieter time-of-year — looking at some of the more timeless and thought provoking charts of the weekly ChartStorms of the past year or so.
1. Lost Decades
Plenty of folk out there telling you to buy and hold and dollar cost average and focus on the long-term. Which is all well and good, but just be mindful that lost decades are actually relatively common... (especially if you expand the sample to other countries’ stock markets).
2. Long-Term Perspective on Earnings
Yes the chart is out of date, but the key takeaway is that overall, longer-term: the trend is your friend. But also note the cycles around the trend (the cycle is an active investor’s best friend!).
3. Another Long-Term Perspective
Legendary investor Warren Buffett made his first billion in his early 50's. It wasn't until he was 65 that he would make his first $10 billion (and surpassing $50B at age 77).
4. Long-Term Shifts
The US stock market went from 15% of global equity markets in 1899 to 56% in 2021. Makes you wonder, what will the next 122 years bring?
5. Index (no)Effect
Used to be that when a stock got added/deleted from an index you'd see a big bump/dump, no more. Perfect example of a market anomaly getting arbitraged out of existence.
6. S&P500 Labor Intensity
"In 1986, it took 8 employees to generate US$1 million in revenue. Today, the S&P 500 is 70% less labor intensive than it was in the 80s"
7. CEO Pay of S&P500 Companies
Snapshot is from a year or two ago, but pretty interesting to see the clustering, range, and tails of the distribution...
8. Computers vs Humans
Apparently computers got more AUM than humans... (maybe a debate to be had around semantics on this e.g. automatic rebalancing is designed by humans, even passive investing is essentially following the decisions of the humans at the index providers, and algo/quant traders are still the product of armies of PhD bearing humans). Intriguing development anyway, with most likely intriguing impact on market structure/function.
9. Founders vs Flounders
Founder-led companies have historically outperformed the rest. Makes sense (incentives, vision/mission, culture, growth stage, etc).
10. Founder Age
Interesting further food for thought on founders... "the older you are, themore likelyyou are to succeed as a startup founder" (sweet spot seems to be 50's). Not only is it never too late to start, it might even be better to start later.
https://chartstorm.substack.com/p/weekly-s-and-p500-chartstorm-24-december
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