What the market's biggest moments teach you.
Real, well-documented market episodes — each paired with a plain-English takeaway about the risk in your own portfolio. General education, not advice.
The dot-com crash
The tech-heavy Nasdaq fell roughly 75-80% peak-to-trough in the 2000-2002 dot-com bust, and took around 15 years to reclaim its 2000 high.
Read the lesson Drawdowns & recoveryThe global financial crisis
The S&P 500 fell about 57% peak-to-trough during the 2007-2009 global financial crisis.
Read the lesson Drawdowns & recoveryThe COVID crash and snapback
The S&P 500 fell about 34% in roughly five weeks in Feb-Mar 2020, then recovered its prior high within about six months.
Read the lesson Drawdowns & recoveryRecovery math is asymmetric
A 50% loss requires a 100% gain just to get back to where you started.
Read the lesson Drawdowns & recoveryThe 2022 rate shock
The Nasdaq fell around 33% in 2022 as interest rates rose sharply.
Read the lesson ConcentrationThe ASX is top-heavy
The S&P/ASX 200's top 10 companies are around 45-50% of the index, dominated by banks and miners.
Read the lesson ConcentrationThe US is most of the world
The US is roughly 60-70% of global equity market capitalisation.
Read the lesson ConcentrationIndex concentration is rising
In recent years a handful of mega-cap technology names have driven a large share of US index returns.
Read the lesson ConcentrationOverlapping ETFs
Many popular ETFs hold the same mega-caps, so stacking several often increases overlap rather than diversification.
Read the lesson DiversificationCorrelations rise in a crash
In sharp sell-offs, correlations between holdings tend to rise toward 1 as almost everything falls together.
Read the lesson DiversificationHome bias
Australian investors typically hold far more domestic equity than Australia's ~2% share of global markets.
Read the lesson DiversificationMost stocks underperform
Research by Hendrik Bessembinder found a small minority of stocks account for most of the market's long-run wealth creation.
Read the lesson DiversificationBonds usually — but not always — cushion
Bonds have historically softened equity drawdowns, though not in every episode (notably 2022, when both fell together).
Read the lesson Valuation & cyclesStarting valuation matters
Higher starting valuations have historically been associated with lower long-run returns.
Read the lesson Valuation & cyclesThe market is not the economy
Stock markets and GDP frequently diverge over multi-year stretches.
Read the lesson Valuation & cyclesRate regimes reshape leadership
Falling rates have historically flattered long-duration and growth assets; rising rates have pressured them.
Read the lesson Valuation & cyclesSector leadership rotates
The leading sector of one decade is rarely the leader of the next.
Read the lesson Investor behaviourThe behaviour gap
Studies (e.g. DALBAR, Morningstar 'Mind the Gap') suggest average investors earn less than the funds they own, by mistiming buys and sells.
Read the lesson Investor behaviourTime in the market vs timing it
Missing a handful of the market's best days sharply reduces long-run returns, and the best days often cluster near the worst.
Read the lesson Investor behaviourRecency bias
Investors tend to extrapolate recent performance into the future.
Read the lesson Costs & compoundingFees compound too
A 1% annual fee can consume a large share of lifetime returns once compounded over decades.
Read the lesson Costs & compoundingThe reward for equity risk is slow
Broad, diversified equity indices have historically compounded around 7-10% a year nominal over the very long run, with multiple 30-50% drawdowns along the way.
Read the lesson Costs & compoundingRebalancing enforces discipline
Periodic rebalancing systematically trims what's grown and tops up what's lagged.
Read the lesson Costs & compoundingTurnover has a tax cost
Frequent trading can trigger capital gains and reduce compounding; in Australia, holding an asset over 12 months can access the CGT discount.
Read the lessonSee these lessons in your own portfolio.
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