These Flawed Arguments Can Be Especially Misguiding In 2026

2026-02-25 16:34:07 ET

These Charts Are Popular But Flawed

With all equity indices (ranging from large-cap, such as DJI , SP500 , and NASDAQ, to small-cap RTY ) hovering around record levels in 2026, these following charts (or some other variations of them) have become increasingly popular, judging by their appearances in my inbox. In the off chance that you are seeing them for the first time, the first example is taken from Lazy Portfolio, and the second one is taken from LPL Financial . These examples vary in some details, but the essence is the same. The signal they are meant to send—at least under the context I’ve seen how they were used—is quite simple: good years of SP500 returns (which are what we’ve experienced or are experiencing now) are followed by bad years....

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