The market is at a record high. Here is why that is not a reason to wait.
7th August 2026
Records keep falling this week. The Dow closed at an all time high on Monday. The S&P 500 and Dow both hit fresh records again on Wednesday morning. Amazon crossed 3 trillion dollars in market value. Earnings season has been strong enough to push indices higher even where individual results were mixed.
For anyone sitting on cash and wondering whether to invest it, this is an uncomfortable moment. The instinct is to wait. Surely the market cannot keep climbing. Surely a pullback is coming. Surely now, of all times, is the wrong moment to put money in.
The data says otherwise, and it says so consistently.
For anyone sitting on cash and wondering whether to invest it, this is an uncomfortable moment. The instinct is to wait. Surely the market cannot keep climbing. Surely a pullback is coming. Surely now, of all times, is the wrong moment to put money in.
The data says otherwise, and it says so consistently.
Records are normal, not rare
Since 1950, an estimated 7 per cent of all trading days for the S&P 500 have closed at a new all time high. That works out to roughly one in every 14 trading days. Markets that grow over time spend a meaningful share of their existence at a record, simply because records are what a rising market produces.
The market was at an all time high in 363 of the 1,188 months between January 1926 and the most recent data, close to a third of the time. Hitting a new high is not an anomaly to be treated with suspicion. It is closer to the default state of a healthy, long-term rising market.
Since 1950, an estimated 7 per cent of all trading days for the S&P 500 have closed at a new all time high. That works out to roughly one in every 14 trading days. Markets that grow over time spend a meaningful share of their existence at a record, simply because records are what a rising market produces.
The market was at an all time high in 363 of the 1,188 months between January 1926 and the most recent data, close to a third of the time. Hitting a new high is not an anomaly to be treated with suspicion. It is closer to the default state of a healthy, long-term rising market.
What actually happens after a record
The more useful question is not whether records happen often. It is what happens next.
Since 1950, average 12 month returns following a new all time high have been 12.7 per cent, fractionally higher than the 12.6 per cent average return for all other 12 month periods. Look at it from a different angle and the picture holds. Returns 12 months after an all time high have averaged 10.4 per cent, compared with 8.8 per cent when the market was not at a high.
Corrections still happen. But the record itself is a poor predictor of when. Within one year of a market high, a correction of 10 per cent or more has occurred only 9 per cent of the time since 1950. Over a three year horizon that falls below 2 per cent. Stretch the window to five years and the S&P 500 has never finished lower than 10 per cent below where it started, measured from any all time high in that dataset.
None of this means a pullback cannot happen next month. It means the record high itself tells you almost nothing useful about when.
The cost of waiting for a better entry point
The instinct to wait for a dip carries a cost that is easy to underestimate, because the market's best days tend to arrive with almost no warning and often right alongside its worst ones.
Over the 30 years to mid-2025, missing the best 10 trading days in the S&P 500 roughly halved the average annual return an investor would otherwise have earned. Missing the best 30 days cut the annual return from 8.4 per cent to 2.1 per cent, below the average rate of inflation over the same period.
The reason this is so easy to get wrong is that the best days cluster around the worst ones. More than three quarters of the market's best days on record have occurred either during a bear market or within the first two months of a new bull market. An investor who steps out during a downturn, intending to step back in once things look calmer, is statistically likely to miss the sharpest part of the recovery. In 2025, the single best trading day of the year landed in the middle of a near 19 per cent spring drawdown driven by tariff policy. Missing that one day alone would have cut the full year return by more than half.
The more useful question is not whether records happen often. It is what happens next.
Since 1950, average 12 month returns following a new all time high have been 12.7 per cent, fractionally higher than the 12.6 per cent average return for all other 12 month periods. Look at it from a different angle and the picture holds. Returns 12 months after an all time high have averaged 10.4 per cent, compared with 8.8 per cent when the market was not at a high.
Corrections still happen. But the record itself is a poor predictor of when. Within one year of a market high, a correction of 10 per cent or more has occurred only 9 per cent of the time since 1950. Over a three year horizon that falls below 2 per cent. Stretch the window to five years and the S&P 500 has never finished lower than 10 per cent below where it started, measured from any all time high in that dataset.
None of this means a pullback cannot happen next month. It means the record high itself tells you almost nothing useful about when.
The cost of waiting for a better entry point
The instinct to wait for a dip carries a cost that is easy to underestimate, because the market's best days tend to arrive with almost no warning and often right alongside its worst ones.
Over the 30 years to mid-2025, missing the best 10 trading days in the S&P 500 roughly halved the average annual return an investor would otherwise have earned. Missing the best 30 days cut the annual return from 8.4 per cent to 2.1 per cent, below the average rate of inflation over the same period.
The reason this is so easy to get wrong is that the best days cluster around the worst ones. More than three quarters of the market's best days on record have occurred either during a bear market or within the first two months of a new bull market. An investor who steps out during a downturn, intending to step back in once things look calmer, is statistically likely to miss the sharpest part of the recovery. In 2025, the single best trading day of the year landed in the middle of a near 19 per cent spring drawdown driven by tariff policy. Missing that one day alone would have cut the full year return by more than half.
Why this matters more, not less, for expats
For clients managing money across currencies and time zones, the temptation to time an entry point is often stronger, not weaker. Moving a lump sum from a UK pension, a sale of property, or an accumulated cash position feels like a single, high stakes decision, and record highs in the headlines make that decision feel riskier than it is.
The evidence points the other way. A financial plan built around a specific goal, a time horizon, and a level of risk you can genuinely tolerate does not need to wait for the market to look calmer. Structured entry approaches, whether a phased investment over several months or a lump sum aligned to your actual timeline, exist precisely so the decision does not hinge on guessing the next headline.
The plan is the point
Markets at record highs are not a signal to sit on the sidelines. They are closer to a feature of long-term investing than a warning about it. The risk that actually damages long-term outcomes is rarely the record high itself. It is the decision to wait indefinitely for a level of comfort that a rising market is not going to provide.
You can book an initial call below.
For clients managing money across currencies and time zones, the temptation to time an entry point is often stronger, not weaker. Moving a lump sum from a UK pension, a sale of property, or an accumulated cash position feels like a single, high stakes decision, and record highs in the headlines make that decision feel riskier than it is.
The evidence points the other way. A financial plan built around a specific goal, a time horizon, and a level of risk you can genuinely tolerate does not need to wait for the market to look calmer. Structured entry approaches, whether a phased investment over several months or a lump sum aligned to your actual timeline, exist precisely so the decision does not hinge on guessing the next headline.
The plan is the point
Markets at record highs are not a signal to sit on the sidelines. They are closer to a feature of long-term investing than a warning about it. The risk that actually damages long-term outcomes is rarely the record high itself. It is the decision to wait indefinitely for a level of comfort that a rising market is not going to provide.
You can book an initial call below.
