The Illusion of Ascent

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The index, designated S&P 500, concluded November with a sequence of gains—seven consecutive months of upward drift. A phenomenon occurring, on average, once every five years. December offered a negligible decrement, a mere tremor, before January resumed the climb. February, however, hinted at a reversal, a shadow falling across the engineered optimism. Such fleeting fluctuations, one might observe, are the very pulse of a system predicated on impermanence.

This seven-month progression—a modest triumph, to be sure—demands scrutiny. Does it signify momentum, a sustained ascent? Or does it foreshadow the inevitable retrenchment, the reversion to the mean that haunts all artificially inflated valuations? The question is not merely statistical; it is a moral one. For in the pursuit of profit, we often lose sight of the underlying realities, the precariousness of our constructed prosperity.

This recent sequence—spanning from May to November of the year 2025—constitutes the twenty-first instance of the S&P 500 achieving seven consecutive months of positive returns. To assess its potential significance—or, more accurately, its likely futility—I examined the preceding twenty such occurrences, calculating the index’s performance over the subsequent twelve months. A timeframe commencing upon the completion of this illusory streak.

The record, presented below, is a testament to the cyclical nature of delusion:

Date Forward 12-Month Return
1/31/1929 -11.5%
10/31/1935 38.1%
11/30/1936 -35.7%
6/30/1943 5.1%
1/31/1950 27.0%
3/31/1954 35.8%
9/30/1958 13.6%
5/31/1961 -10.4%
6/30/1964 3.0%
10/31/1980 -4.4%
2/28/1983 6.1%
5/31/1991 6.5%
3/31/1993 -1.3%
6/30/1995 23.1%
5/31/1996 26.8%
12/29/2006 3.5%
9/30/2009 8.0%
5/31/2013 18.0%
10/31/2017 5.3%
8/31/2021 -12.6%
11/28/2025 ?

For the most part, these periods of ascent are scattered, disparate, and occur within contexts of varying degrees of economic stress. There is no discernible pattern, no predictable correlation. The illusion of order is merely a human projection onto a chaotic system.

Examining the numerical results, we find:

Metric Number
Total 20
Positive 14
Average 7.2%
Median 5.7%
Minimum -35.7%
Maximum 38.1%

Following seven months of gains, the S&P 500 rose over the subsequent twelve months 70% of the time. A modest success rate, to be sure. The average return is a mere 7%, the median even lower. The wide range of outcomes renders any prediction futile. To place faith in such calculations is to succumb to a comforting, yet ultimately false, narrative.

To contextualize these figures, consider the subsequent twelve-month returns for all months over nearly a century of the S&P 500’s existence—approximately 1,200 data points. This represents, in essence, the average expectation for any twelve-month investment period.

Essentially, this is the probabilistic outcome one might reasonably anticipate by engaging with the market.

Metric Number
Total 1,166
Positive 807
Positive % 69.2%
Average 8.1%
Median 9.8%
Minimum -70.1%
Maximum 146.3%

Regardless of the index’s performance in any given month, it rises twelve months later 69% of the time—almost identical to the success rate following a seven-month winning streak. The returns, however, differ markedly. The average twelve-month forward return is approximately 8%, the median nearly 10%. A subtle, yet significant, distinction.

I do not wish to overstate the importance of a sample size of twenty, but a meaningful divergence exists. The median twelve-month forward return for all months is around 10%, but only half that following a seven-month streak of positive returns. A quiet warning, if one is willing to listen.

In short, history suggests that returns over the next twelve months will fall below the S&P 500’s long-term average. Following a prolonged period of ascent—such as the one that has just concluded—a period of underperformance appears likely. The market, like all systems, abhors a vacuum. And the higher it climbs, the further it must eventually fall.

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2026-03-01 08:33