Changes to S&P 500 Over Time - Age of Companies and Market Events

[bobandsherry]

With inclusion of Telsa in the S&P 500 forthcoming, I took a look at the history of companies in the S&P over time. I found this chart interesting, shows the relative age of companies over time (since 1970).



I found it interesting to see how the relative "age" of companies have changed over time, and looked at when the relative age of companies hit a low. Example, lows in/around 1975, early 1980's, 1990, 1999 and 2008.

Market is heading towards another low again..... Inclusion of Tesla will more than likely drop this further. Draw your own conclusion or inferences, but I found it interesting to see how those lows align to key periods of challenges in the market. Also note what happened after those events, the relative age of companies in the S&P shot way up - flight to quality? Things that make you go "Hmmmmm........"....

Here's source to this chart: https://www.qad.com/blog/2019/10/sp-500-companies-over-time

 

[VanWinkle]

The human mind loves a pattern...........

 

[Stormy Kromer]

"It's different this time"

 

[FREE866]

Market is heading towards another low again.....

what are you basing that on?

 

[Time2]

With inclusion of Telsa in the S&P 500 forthcoming, I took a look at the history of companies in the S&P over time. I found this chart interesting, shows the relative age of companies over time (since 1970).

View attachment 36765

I found it interesting to see how the relative "age" of companies have changed over time, and looked at when the relative age of companies hit a low. Example, lows in/around 1975, early 1980's, 1990, 1999 and 2008.

Also note what happened after those events, the relative age of companies in the S&P shot way up - flight to quality? Things that make you go "Hmmmmm........"....

Here's source to this chart: https://www.qad.com/blog/2019/10/sp-500-companies-over-time

Someone needs to add stretch out the chart and add the S&P 500 chart. That way we can really see any correlation.
Not that correlation is a bad word.

 

[OldShooter]

The human mind loves a pattern...........

Yes. Examples: https://tylervigen.com/old-version.html

 

[Chuckanut]

Yes. Examples: https://tylervigen.com/old-version.html

Gosh, I didn't realize watching Nicholas Cage movies was so dangerous.

But then I checked out his filmography. YIKES!

Vampire's Kiss, Time to Kill, Deadfall, etc. He's almost as dangerous as Jessica Fletcher.

 

[bobandsherry]

what are you basing that on?

The "Market is headed towards another low again" is in regards to the age of the companies in the S&P -- relative to the chart being discussed. As for based on, as stated in the next sentence "Inclusion of Tesla will more than likely drop this further." Making that statement as Tesla is a relatively new company, unknown who is being removed to make place, so we'll see what the mix looks like when Tesla is phased into the S&P.

Not a forecast or prediction as to the market valuation, as I also stated in the original post "Draw your own conclusion or inferences". Just found it interesting to see a relationship to past events and the drop of the age of the companies. Will history repeat? Time will tell