The Economic Timesยท2025-11-08 04:20Market Overview - The U.S. stock market has seen significant wealth generation, with Nvidia briefly reaching a market valuation of $5 trillion, while Microsoft and Apple also topped $4 trillion [1][14] - The Nasdaq index experienced a decline of approximately 3% for the week, marking its largest weekly percentage drop since early April [3][14] Performance Analysis - Investors who held an S&P 500 index fund since the start of the current bull market on October 12, 2022, have doubled their investment [2][14] - Nvidia's stock has lost up to 4% recently, with its market value decreasing by over $600 billion since its peak [6][14] - The Nasdaq has gained more than 50% since April, driven by optimism around artificial intelligence [3][14] Historical Context - Bear markets are defined as price declines of at least 20%, with 15 such occurrences recorded for the S&P 500 and its predecessors since 1929 [7][14] - The worst bear market since 2000 was triggered by the financial crisis of 2007-2008, with the S&P 500 dropping 56.8% [8][14] - The S&P 500 has returned 8.1% annualized since 2000, despite experiencing four bear markets during this period [10][14] Investment Strategy - Long-term investment in the stock market has historically yielded substantial returns, with the S&P 500 generating a return of 38,881.17% over 60 years [9][14] - A traditional 60/40 portfolio, consisting of 60% stocks and 40% high-quality bonds, is recommended as a compromise between risk and safety [11][14] - Global investment is advised as the strong performance of the U.S. stock market may not be sustainable [11][14]