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LowRisk.com!
We have some great charts for you below...if this is your type of
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This is a chart of the DJIA for the last 104 years (1897 - 2000). This first chart is on a linear
scale. |
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This chart does not really provide much information.
For instance, from 1928 to 1931 the market dropped from
300 to 77.9. This was a huge price drop of 75%, but it
barely shows as a tiny blip in the chart. It is dwarfed
by the gains made in recent years. That is the nature of
a linear chart. But make no mistake, that 75% drop was
incredibly painful. For a more accurate look at very
long term charts, you need to look at logarithmic charts.
These charts (called log charts for short) are
constructed so that similar moves in percentage terms
look the same, regardless of the actual price change.
Here is the same 100 year period in a log chart.
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In this chart you can see how significant the drop in
the late 20's and 30's really was. You can also see that the price
rise in the last decade has not been quite as extreme as
it looks in the linear chart.
One question we often get about these charts is about the 1987
crash. It doesn't show up on these charts, and many people think we
have an error in our data or in the charts. Well, there isn't...the
charts are accurate. This is a yearly chart that uses one value per
year, which is the closing value of the Dow Jones Industrials on the
last trading day of the year. At the end of 1986, the Dow closed at
1895.95. At the end of 1987, the Dow closed at 1938.83. The 1987
crash was devastating, but in that crash the market primarily gave
up most of the gains that it had made earlier in the year. So on this yearly
chart, it doesn't even show up.
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Interesting stuff? This site is packed with similar
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