With the first half of 2015 behind us, the Nasdaq-100 is riding an unprecedented 10-quarter win streak. This beats the previous record of nine quarters that was set during the raging bull market of the late 1990s. With plenty of debate around the sustainability of the current streak, we thought it would be interesting to examine this historical first- and second-quarter Nasdaq-100 performance.
Recap of the current win streak
Historical First Quarters
- Since 1990, the Nasdaq-100 has had a positive first quarter 16 times.
- The median gain of those 16 quarters is 5.7%.
When the Nasdaq-100 was positive in the first quarter of the year, it set a positive tone for the remainder of the year. The index ended the entire year higher in every instance except for one, which happened to be the market sell-off of 2000. The median annual performance in a year with a positive first quarter is a remarkable 36.9%.
Historical Second Quarters
- Since 1990, the Nasdaq-100 has had 17 positive second quarter 17 times.
- The median gain of those 17 quarters is 9.2%.
The frequency of positive second quarters is greater with 17 occurrences since 1990. In only three instances did the Nasdaq-100 trade lower for the year: 1990, 2001, and 2008. Overall, the median annual gain for the Nasdaq-100 following a positive second quarter is just slightly over 20%.
Taking it a step further, there have been nine past occurrences when the Nasdaq-100 was positive in both the first and second quarters, and in every occurrence the Nasdaq-100 finished the year higher with a median gain of over 42.5%.
To put this into perspective, we compared similar metrics to the S&P 500 Index. In terms of frequency, the S&P has a greater number of positive occurrences, but the median gains lag compared to the Nasdaq-100. Similarly, in years when both the first and second quarters of the S&P 500 were positive, the index ended the year higher in each occurrence with a median gain of 21%.
The final take away: regardless of the index you follow, that positive first half performance sets a bullish tone for the rest of the year. It will be interesting to see if 2015 stays true to history.
Nasdaq® and NASDAQ OMX® are registered trademarks of The NASDAQ OMX Group, Inc. The information contained above is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice, either on behalf of a particular security or an overall investment strategy. Neither The NASDAQ OMX Group, Inc. nor any of its affiliates makes any recommendation to buy or sell any security or any representation about the financial condition of any company. Statements regarding Nasdaq-listed companies or Nasdaq proprietary indexes are not guarantees of future performance. Actual results may differ materially from those expressed or implied.
Past performance is not indicative of future results. Investors should undertake their own due diligence and carefully evaluate companies before investing. ADVICE FROM A SECURITIES PROFESSIONAL IS STRONGLY ADVISED. © 2015. The NASDAQ OMX Group, Inc. All Rights Reserved. The matters described herein contain forward-looking statements that are made under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements about Nasdaq and its products and offerings. We caution that these statements are not guarantees of future performance. Actual results may differ materially from those expressed or implied in the forward-looking statements. Forward-looking statements involve a number of risks, uncertainties or other factors beyond Nasdaq’s control. These factors include, but are not limited to factors detailed in Nasdaq’s annual report on Form 10-K, and periodic reports filed with the U.S. Securities and Exchange Commission. We undertake no obligation to release any revisions to any forward-looking statements.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.