Rule Du Jour: Rule #54 Risk Happens Fast (Patreon)

Rule Du Jour: Rule #54 Risk Happens Fast

Risk Happens Fast, as I say most of the action happens in ten best days a year in the markets.  

From 1930 to 2020, the S&P 500’s average annualized return was around 9.9% when fully invested. However, if an investor missed the 10 best days per decade (roughly 1 day per year), their annualized return dropped to just 5%. Missing the 20 best days per decade reduced it further to 2.8%.

For individual stocks today was one of those days. Since Tesla’s IPO on June 29, 2010, there have been 3,707 trading days, with only 53 days seeing the stock close up 10% or more. Today marked one of those rare occasions.  

Tesla stock is at $279, surging $30 from the Friday Close 12%, making it the 33rd largest single-day gain in the company’s history.