It's been nothing short of a crazy year for Wall Street and investors. The panic and uncertainty caused by the unprecedented coronavirus disease 2019 (COVID-19) pandemic initially sent the broad-based S&P 500 (SNPINDEX: ^GSPC) lower by 34% in just under five weeks. The 17 calendar days it took for the index to fall from an all-time high into bear market territory, as well as the roughly four calendar weeks it took for losses to total more than 30%, are both records.
However, we've also witnessed the most ferocious rally in the history of the benchmark S&P 500. It took less than five months for the index to erase all of its coronavirus crash losses. As of this writing, it still sits higher on a year-to-date basis despite this week's losses.
Historically, buying equities during periods of correction has proved to be a smart move. That's because every correction in stock market history has eventually been erased by a bull market rally. If investors are patient enough and diligent about choosing great businesses, operating earnings growth favors equity valuation expansion over time.