The stock market is probably the most essential component of a free-market economy. It supports democratized access to trading and an exchange of capital while attempting to offer a level playing field for investors of all kinds. That’s not to say that the professional money managers and big investors don’t have certain advantages and privileges, but only a free-trade stock market offers an arguably fair chance for everyday individuals.
One does not necessarily need stock market statistics and facts to understand the effect these markets can have on the whole world. That became evident to everyone 10 years ago when the global economy was plunged into the second most damaging recession in history. The Great Recession reminded everyone how fragile the economy can be.
What’s more troubling, however, is that we are probably not aware of all the effects that the aftershocks of the crisis will have on the course of history. It’s important to keep looking and listening, because it is always far better to prevent a problem than to deal with the fallout of a crisis – especially when the next one could prove to be even more catastrophic.
Our goal with the stock markets stats and facts we present here is to create a place where all the most interesting information and up-to-date data is available for you to read, share, and keep in mind. An informed mind is the first step toward a healthy economy.
Key Statistics on Stock Markets – Editor’s Choice
- The United States represents 40.01% of the entire world stock market capitalization.
- In 2018, the global market cap shrank 14.9% from the year before.
- About 10% of US households hold international equity.
- The current bull market has been going on for a record 10 years.
- On average, the market performs the poorest in September.
Interesting Stock Market Statistics
1. By the end of 2018, total market capitalization was down 14.9% compared to 2017.
The World Federation of Exchanges notes that the global market cap dropped for the first time since 2014. When we look at how much the high volatility in equity and currency markets affected each region, however, the numbers show distinct differences. The Americas were down 6.3%; Europe, the Middle East, and Africa were down 16.5%; and the Asia-Pacific region was down by 23.8%.
2. There are 16 stock exchanges in the world with a market capitalization of more than $1 trillion.
These stock exchanges accounted for 87% of global market capitalization in 2015. NASDAQ and the New York Stock Exchange have more market cap between them than the rest of the exchanges on the list combined.
3. Middle-class households have lost more than half of household equity holdings since 1989.
One of the more worrying current stock market statistics is the ever-growing gap between classes. In 1989, middle-class citizens owned 15% of all household equity holdings, and in 2016 they held just 5%. Contrast this with the fact that the equity holdings of the top 0.1% wealthiest citizens rose about 5% in the same period, and the true danger that inequality presents to the US market becomes clearer.
4. About 10% of US households hold international equity.
This is one of the more encouraging stock trading statistics. US stock market numbers over the past decade reveal that American households are increasingly diversifying. Ever since the Great Recession in 2008, the global equity share that Americans are holding has also been on the rise, with only small bumps on the road. During the past decade this share in the world equity market has risen by almost 15%, fueled by economic recovery and less costly and restrictive ways to invest internationally.
5. Stock market declines of 5% to 10% generally require a month’s recovery time.
Stock market crash statistics pulled from historical data show that the most commonly experienced market declines are the easiest to recover from, especially when compared to bigger pullbacks. In fact, a drop of 10-20% usually takes 4 months of recovery, while a 20-40% decline takes 15 months. The biggest market drops we’ve experienced were drops of more than 40%, which last for an average of 22 months but take about 58 months to recover from, making them potentially catastrophic.
6. The current US bull market is 10 years old and counting.
To better illustrate how incredible this is, just take a look at stock market statistics of historical data. Bull markets have on average lasted for about 4.5 years each. The current boom is therefore not only more than double the average, but is also the longest in American history. What makes this bull market unusual is not that it happened after a recession, which was expected, but that it maintains slow-but-steady growth.
This was made possible by record low interest rates and record-high corporate profits, mostly from the rising tech industry. Companies like Apple, Google, and Amazon are now the most valuable corporations in the world, and their rise to join Microsoft has helped the market quadruple its capitalization since the worst days of the financial crisis.
7. The United States represents 40.01% of global market capitalization.
US global market cap has reached this level for the first time since 2005 due to a strengthening dollar and gains in American equities. Also, an ongoing decline in most international equity markets has helped boost the US share of the world’s market cap.
China is the country that took the biggest hit since the 2016 American presidential election. On election day of election, the US made up 36.53% of world market cap compared to China’s 10.21%. America has gained 3.48% since then while China has lost 2.7%. This sudden drop pushed China back into third place on the list, behind Japan, as the stock market graph below shows. Hong Kong is fourth with 6.51%, and the UK holds fifth place with 4.49%.
Percent of World Stock Market Cap by Country
8. On average, stock market corrections happen once every two years.
A stock-market correction is a market decline between 10% and 19%. These sorts of drops are significant, but just below the threshold for starting a bear market. They used to happen about once a year at the beginning of the century. Things changed after World War II, and market corrections have become infrequent.
Since the beginning of 1980, there have been 13 corrections in the S&P 500. The average length is 54 days, with an average 13.5% decline of stock market percentage. In the same period, the decline has reached more than 20% only three times.
9. Valued at $1.03 trillion, Microsoft leads the world’s corporations in market capitalization.
As the American technology sector exploded after the global recession, Microsoft got challenged by two large new rivals for the top spot and the honor of being the most valued company in the world. For years, it fought a close race with Google and Apple. Amazon has recently joined the fight.
In fact, as of the second quarter of 2019, Amazon has climbed to the second spot on the list, with a global equity market capitalization that amounts to $928.5 billion, rising quickly past Apple. For comparison, the market value of Apple rose by about $16 billion since Q1 of 2019, while the market value of Amazon rose by $45 billion. Alphabet, the parent company of Google, fell in the same period but remained in fourth place, at $751.1 billion in market value.
10. With 19% market share, the technology sector leads the US stock market in market capitalization.
The face and the size of the US stock market have both changed drastically as technology innovation and the rise of giant corporations move the share of capitalization more toward modern digital solutions. It is no surprise that the communications sector now comes in second place with 14% of market capitalization, followed by information technology at third with 12%. There is also a huge rise in healthcare stocks, which now represent 9% of the stock market, showing that the market never stops changing.
11. More than 80% of the stock market is now automated.
Automation is overtaking many industries, and stock markets are certainly not immune to the appeal and advantages of machine-led algorithm trading. That is why stock market statistics from 2018 show that the vast majority of US trades are already done by machines. Computers use advanced mathematical models to make high-speed trading decisions, creating a market that is more focused on short-term movements and sell-offs than on long-term outlook.
12. Share repurchases rose by 22% in the first quarter of 2019.
Since the start of the year, the total value of the stock market increased by over $5 trillion. This explosive growth reflects the widening gap between corporations and private investors. In fact, share repurchases in 2019 already amount to $270 billion, which dwarfs the amount of money drawn from mutual funds.
13. Corrections are least likely in the third year of a presidential term.
Stock market statistics by year recorded from the past two centuries show that average S&P 500 returns are the highest right after midterms and in the third year of a president’s term. This has become known as the “Presidential Cycle Theory” of stock returns. Numbers do seem to support the theory.
Historically, the average S&P 500 returns for each year of a presidential term go from 5.2% the first year, 4.8% the second year, 12.8% the third year, and 5.7% the fourth year.
This data can be attributed to the power of uncertainty. Uncertainty is a cause for poor stock performance leading up to the midterm elections, causing investors to be more cautious. After the midterms, investors begin to ease back into the market, knowing that there will be at least two more years of political stability before the next election.
Fascinating Facts About the Stock Market
14. The stock market usually performs the worst in September.
The September Effect is one of the most fascinating phenomena of the financial world. Both the Dow Jones and the S&P 500 have averaged a slight decline each September since 1950, and ever since Nasdaq started operating in 1971, its composite index has also slightly decreased during this month of the year.
What makes stock market facts like this one so interesting is that it wasn’t ever really related to market events and news, and that it keeps happening in stock markets across the globe. The September Effect has begun to dissipate in recent years, and large market declines in September are not happening as much as they did before 1990.
15. Since 1903, every day at the New York Stock Exchange starts with the ringing of a bell at 9:30 a.m.
The opening bell was usually just what the beginning of the trading day was called, but the New York Stock Exchange has rung an actual bell ever since it replaced a Chinese gong that was used before 1903. And while this is certainly one of the more interesting facts about the stock market, it has also become an iconic and famous event. The opening bell has become one of the most watched daily events in the world.
The ceremony itself was not that publicized or popular before President Ronald Reagan asked to ring the bell in 1985 during his campaign for reelection. Ever since then, the NYSE opening bell has been a magnet for celebrities, sports stars, and leaders of the world’s biggest corporations. It is now considered not only a prestigious honor, but also a great platform for visibility in the age of the internet and social media.
16. The most expensive stock in the world is Warren Buffet’s Berkshire Hathaway.
It is only the rarest investment statistics that most professionals agree on. One of them is that Warren Buffet is probably the greatest investor of all time. It seems fitting that the most expensive stock in the world belongs to his firm, Berkshire Hathaway.
This huge conglomerate owns some of America’s best-known companies, brands like Dairy Queen, Geico, and Duracell. It also has huge stakes in giant companies like Coca Cola and American Express. What really makes Berkshire stock worth $305,085 per share is the fact that the company never did a stock split, meaning that it never devalued the worth of a single share.
17. Established in 1602, the Amsterdam Stock Exchange was the first in the world.
Among stock market fun facts are some that seem a bit strange. This is one of them. Rich empires and trading economies like Venice, India, and others traded in loans and debt on the streets, but no official stock exchange existed before 1602. It was only then, in the small town of Amsterdam, that the first stock exchange was established.
This historic decision was made possible by the creation of the first multinational corporation ever, the Dutch East India Company. This was the first company that issued stocks, and one of the richest and most powerful corporate entities that ever existed. It came about as a consequence of fierce European competition for supremacy in trade with Asia, and it transformed the Dutch nation forever.
The Dutch East India Company didn’t give power to private investors. The company was owned by directors but the huge share it had in the total market cap of the stock market brought unprecedented prosperity to the people. In fact, during the two centuries of its existence, the company paid out 1,600% in dividends. Annual dividends averaged 16% over the first half of the 17th century.
18. Changes in stock prices were expressed as fractions until the year 2000.
Before the Securities and Exchange Commission ordered all stock markets in the United States to convert to decimal quotes by April 9, 2001, market price quotes were based on fractional quoting. For instance, the minimum spread was 1/16 of a dollar, or $0.0625. After decimalization, the minimum spread was set to $0.01 for stocks over $1 and $0.0001 for stocks under $1.
Decimalization made a cumbersome and outdated system much more understandable to investors. It also positively affected stock market performance by making trading more efficient and better organized, which was necessary for the US to keep up with international competition. Before 2001, the London Stock Exchange and the Paris Bourse were ahead of American stock markets, pushing Congress to enact the law and implement decimalization, which ended a tradition that can be traced to the 17th century.
19. Australia has had the best performing share market in the world from 1900 to 2009.
During the past century, Australia posted 7.5% after-inflation returns per year, which are the highest among the world’s 19 major markets. The country also placed second lowest in volatility, proving how stable and prosperous this period has been. In comparison, US stocks generated a 6.2% return at the same time.
Stock market facts from 2019 show that with the recent rise of China, Australia’s great performance is even more pronounced. The Asian giant is the biggest Australian trade partner in terms of both imports and exports, while Australia is China’s sixth-largest trading partner. Australia has an incredible amount of valuable metals, coal, oil, and natural gas, and it is one of the world’s biggest exporters of beef. The mining sector is so crucial for Australia that two of the biggest Australian stocks in the Standard & Poor’s ASX 200 index are miners BHP and Rio Tinto.
20. Women first worked on the New York Stock Exchange in 1943 due to a shortage of male workers during World War II.
For the first half of the 20th century, the NYSE was open exclusively to men, same as the older building that housed the exchange from 1792 to 1903. But the exchange was left short of clerks and runners during World War II.
This temporarily opened the doors of the NYSE to women for the first time in the famous stock market’s history, allowing them to work on the trading floor. This lasted until 1947. Women were banned again until 1965 when Muriel “Mickie” Siebert bought a seat on the exchange and became the “First Lady of Wall Street.” For the next decade, Siebert was the only woman working at the NYSE, earning herself recognition and having a room on the seventh floor named in her honor.
Stock market stats clearly mirror the stability and prosperity of our entire interconnected world. The Global Recession proved to everyone how fragile and damaging a big market retraction can be, amplifying the need to do everything we can to avoid such drops in the future.
Today’s record bull market may be prolonged further than anyone could have predicted, and we may not see a recession for many years. However things play out in the near future, there is one thing that stock market statistics make quite clear: More exciting and perhaps frightening changes await us all. From technological disruptions to the ever-shifting face of the modern world economy, there is plenty to be hopeful and cautious about as we enter the third decade of the century.