Chart Kid Matt has this great chart on his blog about sector returns for the S&P 500 this decade:
Here’s Matt on the numbers:
I knew Tech has carried this decade, but I was still shocked when I ran the numbers.
61.5% of the S&P 500’s 131.9% return has come from Tech.
No other sector even comes close.
Loop in Comm Services and that’s 78.4% of the 131.9% overall gain in the S&P 500 coming from just two sectors.
Power laws in the stock market strike again.
Tech stock returns seem to defy logic but these types of stocks have a history of gigantic moves — both up and down.
The size of the gains and losses are staggering when you dig into the data.
Here are the calendar year returns for the Nasdaq 100 since 1995:
A few things stand out from this chart.
First, there have been far more gains than losses. In the past 31 years, gains outnumber losses by a ratio of 26 to 5. That means the Nasdaq 100 has been up in 84% of those years.
The gains tend to be large to quite large.
In 1 out of every 4 years, gains have been 40% or more. Nearly half of the years since 1995 have seen gains of 20% or higher.
Losses are few and far between but when they happen they’re no joke.
You’ll notice there are just five red numbers for the down years on the chart. Every single one of those losses was -30% or worse.
These were the five down years since 1995:
- 2000: -36.1%
- 2001: -33.3%
- 2002: -37.4%
- 2008: -41.7%
- 2022: -32.4%
Remarkably, every down year for the past 3 decades has been a gargantuan loss. In contrast, the S&P 500 has had just one down year with losses of 30% or more (in 2008 when it fell 37%).
It’s also crazy that after the dot-com bubble ended there were three years in a row of losses in excess of 30%.
The max drawdown for the S&P 500 was -57% while the Nasdaq 100 dropped more than 80% following the bursting of the dot-com bubble and the Great Financial Crisis.
There have been far bigger booms and busts in the Nasdaq 100 but investors have been rewarded for those risks.
These are the annual returns since 1995:
- Nasdaq 100 +15.0%
- S&P 500 +11.1%
No pain, no gain.
The big question is this: Will the next down year, whenever it happens, be this bad?
We shall see…
Further Reading:
How Much Will the Stock Market Fall in 2026?
1The Nasdaq 100 isn’t all tech stocks but they make up aroudn 70% of the index right now if you include communication services.
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