The Nasdaq Composite has officially entered a bull market, a milestone that has only occurred eight times since 1990. The Nasdaq Composite is one of the three major U.S. financial indexes, along with the S&P 500 and the Dow Jones Industrial Average. The Nasdaq is known for its focus on growth and technology stocks.
In November 2021, the Nasdaq fell into a bear market due to recession fears brought on by inflation and rising interest rates. However, the expected recession did not materialize, and economic growth accelerated, leading to a rebound in many stocks. The index reached a new record high on Feb. 29, 2024, officially marking the start of a new bull market.
Historically, the Nasdaq has experienced eight bull markets since 1990, with an average return of 215% over an average duration of 1,223 days. Based on this historical data, the current bull market could see a potential upside of 157% by April 2026.
While past performance does not guarantee future results, long-term investors in the stock market have been well rewarded. The Nasdaq Composite has seen a 3,500% increase since 1990, compounding at an annual rate of 11%. Investors can consider investing in an index fund that tracks the Nasdaq Composite or adding technology stocks to their portfolios to potentially benefit from the growth in sectors like artificial intelligence, cybersecurity, and robotic process automation.