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Market Moves

We’re in the Longest Bull Market in History, or Are We?

While Wall Street proclaimed a new record on Wednesday, another view holds that the celebration must wait until 2021.

By Larry Light

Well, stocks finally did it. On Wednesday, the market marked the longest bull run in history, at 3,453 days. The rally that began amid the wreckage of the financial crisis on March 9, 2009, set the record. Or did it?

The traditional way of defining a bear market is a fall of 20% or more. You start counting a bull market at stocks’ lowest point after that slide. The previous bull recordholder ran from October 1990 to March 2000.

Trouble is, the start date of the last bull market champ is under dispute. Some think its actual beginning date should be earlier, following the late-1987 crash. All in all, the 1987-1990 market slump was 19.9%.

Indeed, Sam Stovall, chief investment strategist at CFRA, noted that there is no official body that has ordained that a 20% drop constitutes a bear market. That 20% is merely a convention. Nevertheless, most of the investing world has brushed aside the 0.1 percentage point shortfall. Stovall’s firm is among those that doesn’t.

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If you agree with him, the bull market dates back to 1987. This means our current market has longer to go before it can claim the title—waiting until April 3, 2021, in fact, for a full span of 4,407 days.

Using any measure, this market rise has been bountiful, with the S&P 500 quadrupling since its low point in early 2009. The good thing, from an investor’s viewpoint, is that bull markets last longer than bear ones. By Bespoke Investment Group’s reckoning, since 1927, the average bull run has lasted 981 calendar days, and the average bear period just 296.

Even better, since World War II, the bull/bear market cycles became much longer. The average bull market was 1,651 days and gained 152.4%, Bespoke wrote in a recent report. And the average bear span was 362 days, declining 31.8%. The current bull stampede, Bespoke declared, “is more than double the length and strength of the average bull market.”

So take that, you statistical killjoys. Enjoy it while you can.

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Home > News > Risk > Ontario Teachers’ Nets a 3.2% Return in 2018’s First Half
Risk

Ontario Teachers’ Nets a 3.2% Return in 2018’s First Half

Public, private equity and inflation-linked assets bolster the Canadian pension plan.

By Chris Butera

Assets of the Ontario Teachers’ Pension Plan climbed to C$193.9 billion ($149.1 billion) Wednesday, as the fund announced its first half 2018 results.

The Canadian pension plan returned a net 3.2% in the period ended June 30, adding C$4.4 billion to the fund’s value from last December.

“Returns in the first half were driven mainly by the performance of the equity asset classes, both public and private, and the inflation sensitive asset class,” said Ziad Hindo, the plan’s chief investment officer.

Hindo became CIO in June and was also named executive managing director last week.

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Since its 1990 inception, the pension plan has returned 9.9% annually. The five- and 10-year net returns as of December 31, 2017, were 9.6% and 7.6%, respectively. It has been fully funded for five years as of December.

Most recently, the pension plan breaks down its portfolio into equities (a 35% allocation), fixed income (also 35%), inflation-sensitive assets (16%), real assets (25%), credit (7%), and absolute return strategies (also 7%).

As for individual allocations, bonds consisted of 24% of the portfolio for the first half of 2018, followed by public equity, at 18%. Private equity accounted for 17%. Real estate was at 14%, and 11% was allocated to fixed income-based real-rate products. Infrastructure was 9% and commodities were 7% of the portfolio during the period. Inflation hedge assets, natural resource investments, and real-rate products tied to real assets stood at 5%, 4%, and 2%, respectively.

Ontario Teachers’ did not list the individual performance of its asset classes, nor could it be reached for comment on such.

The fund expects volatility to continue due to global trade and geopolitical tension as well as the increase in energy prices.

Ron Mock, Ontario Teachers’ president and chief executive officer, touted the ability of the plan’s balanced portfolio despite the “uncertain markets.”

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