Fidelity Study Shows S&P 500 Record Highs Signal Growth

Fidelity Investments released a study analyzing S&P 500 returns since 1920, finding that investing on days when the index closed at an all-time high yielded an average return of 9.9% over the following year. These results slightly exceeded returns seen when investing on non-record days, with cumulative returns reaching 63% over five years.

The findings come as the S&P 500 trades near record highs, sparking investor debate over whether to buy stocks or wait for a market correction. The analysis suggests that record highs are a natural result of long-term appreciation rather than a signal of an imminent crash.

Financial analysis indicates that attempting to time the market is generally counterproductive for long-term investors. For those with a decade-long time horizon, the study recommends continued investment in vehicles such as the Vanguard S&P 500 ETF.