Just how much did we spend this holiday season? How much has economic expansion grown from its prior peak? How many 1% moves did the S&P have in 2018 and what is the long-term average? Test your knowledge in the latest edition of "Did You Know?".
CHRISTMAS SPENDING
Question: Just how much did we spend during the holiday season this year?
- $242 Billion
- $578 Billion
- $720 Billion
- $900 Billion
Answer:
- $720 Billion
According to the National Retail Federation’s annual consumer spending survey, Americans were expected to spend nearly $720.89 billion on gifts, decor, travel and more during the 2018 holiday season. Individually, total spending was expected to average $1,007 per person.
S&P MOVEMENT
Question: Volatility is back. While we experienced 20 days in 2018 where the S&P 500 moved by at least 2% up or down, how many 1% moves did we experience in 2018 and what is the long-term average?
- 20 and 48
- 64 and 51
- 49 and 30
- 35 and 38
Answer:
- 64 and 51
In 2018, we experienced 64 days where the S&P 500 moved by at least 1%. The long-term average for total 1% moves by the S&P 500 is 51 times. During the year we also experienced a total of six moves of at least 3% and two moves of at least 4%. The last time we experienced a move of at least 4% was in 2011.
ECONOMIC EXPANSION
Question: The U.S. economy should record its longest recovery ever this year. While the runway has been long, the two other longest recoveries experienced economic GDP growth of approximately 40% and 50% from their prior peaks. How much has this economic expansion grown from its prior peek?
- 60%
- 45%
- 30%
- 15%
Answer:
- 15%
Since 4Q07, the economic expansion has grown by 15%.
EQUITY GAINS
Question: According to Dalbar, over the last 20 years the S&P 500 has gained 7.68%. What return has the average “equity” investor gained for the same time period?
- 8.2%
- 7.2%
- 4.7%
- 2.6%
Answer:
- 4.7%
The 20-year annualized return for the average equity fund investors was only 4.79%, a gap of 2.89% with the S&P 500. An equity investor is unlikely to consistently beat an index over long time periods because indexes do not account for the effect of trading costs, taxes and fees. The underperformance directly relates to the psychological behavior of individual investors. If investors have patience and a long-term vision to stay invested, they are more likely to meet their financial goals.
