Don’t Catch a Case of “Breakevenitis” Around All-Time Highs

Breaking Through the Breakeven Point

Just because stocks have recovered losses from a recent correction doesn’t mean the bull market is over. Historically, bull markets tend to run for a while longer after experiencing a correction. For instance, Exhibit 1 shows that after the market correction in 2016, global stocks not only rebounded to all-time highs, but went on to gain an additional 31% before the next correction in 2018. Similarly, following the sharp -34% drop during the early 2020 COVID-related market downturn, stocks recovered to breakeven and continued climbing, achieving a 38% gain before the 2022 bear market began.

Exhibit 1: Stocks Tend to Keep Rising After Recovering from Downturns

Source: FactSet, as of 6/10/2025. MSCI World Total Return Index levels, daily, 3/9/2009 - 5/29/2025.

Exiting the market at breakeven could mean leaving considerable growth opportunities on the table. Stocks have a long history of continued growth after recovering to breakeven points. While it’s instinctive for investors to be cautious, it’s important to recognize that breakeven isn’t the finish line—in most cases, it’s just the beginning of the market’s next growth phase.

Bull Markets Are Full of All-Time Highs

While investors can be reluctant to invest around new all-time highs, broad stock market indexes have gone on to reach many new all-time highs. In fact, since the 1950s, the S&P 500—which has a longer price history than global stocks—has reached new highs over 1,321 times!^[i]

Exhibit 2 looks at this dynamic in a slightly different way—using global stocks and monthly highs. As one might expect, all-time highs (yellow dots) cluster in bull markets, and most were followed by further highs. In fact, after hitting a new high, global stocks have risen over the next twelve months 75% of the time.

Exhibit 2: A Long History of New All-Time Highs for Global Stocks

Source: FactSet, as of 6/13/2025. MSCI World Total Return Index (log scale, base 10), monthly, 1/1/1970 – 5/30/2025.

Investing At All-Time Highs Often Doesn’t Hurt

At Fisher Investments, we typically discourage investors from trying to time the market—particularly when using arbitrary price levels as an indicator. Market timing can have an impact on an investor’s returns, but stocks are highly volatile in the short term, and waiting for a “better opportunity” often backfires. Exhibit 3 shows the “consequences” of investing at an all-time high. Perhaps counter-intuitively, the returns when investing at an all-time high (yellow bars) aren’t all that different than investing on any given day in the market (green bars).

Exhibit 3: Average Forward MSCI World Total Returns, January 1970 – May 2025

Source: FactSet, as of 06/13/2025. MSCI World Total Return Index, monthly, 12/31/1969 – 05/31/2025.

Determining whether a market high signals the end of a bull market requires a deeper analysis. Consider investor expectations and whether those align with anticipated economic and political factors on corporate earnings over the coming 3-to-30 months. Worrying about all-time highs, in our experience, is just another part of the "wall of worry" that stocks love to climb.

Want to Dig Deeper?

In this article, we reviewed what all-time highs mean—and don’t mean—for markets. For more analysis on why fears over all-time highs are overblown, you can read Fisher Investments’ MarketMinder article, “Deep Dive: Break the Urge to Sell at Breakeven.”

To learn more about what new all-time highs mean for markets, watch this video from Fisher Investments’ founder, Executive Chairman and Co-Chief Investment Officer Ken Fisher.

For more market insights from Fisher Investments, read our latest articles.

Investing in securities involves a risk of loss. Past performance is never a guarantee of future returns. The results for individual portfolios and for different periods may vary depending on market conditions and the composition of the portfolio. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. The foregoing constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. Nothing herein is intended to be a recommendation. The opinions expressed are subject to change without notice.

[i] Source: FactSet S&P 500 Index Price Level, daily from 1/1/1950 – 6/13/2025.