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The records go back more than two centuries, and the information is surprising. During the two centuries that ended in 2000, bull markets averaged 15 years in length. Stocks during those years returned about 12.5 percent per year.

Here are the data for the bull years, which were pretty fat.

      Real Yearly Returns

1815-1835      9.6%

1843-1853      12.5%

1861-1881      11.5%

1896-1906      11.5%

1921-1929      24.8%

1949-1966      14.1%

1982-2000      14.8%

At about 12 years each, bear markets have historically been shorter, and the bears did not bite too hard. On average during those years investors did not make money, but ended the year flat. Ending the year with no return doesn’t sound that bad in today’s low-interest-rate environment, but represented a significant opportunity cost for investors of the day.

And here are the numbers for the lean years:

      Real Yearly Returns

1802-1815     2.8%

1835-1843      -1.1%

1853-1861      -2.8%

1881-1896      3.7%

1906-1921      -1.9%

1929-1949      1.2%

1966-1982     -1.5%

Why are these data important? It seems to me that if we know where we stand in these primary cycles, we can make better stock-picking decisions. And that takes me to the chart at the beginning of this piece. The two great crashes in the chart (2002 and 2009) reflected external events. The first was a response to the four coordinated terrorist attacks by al-Qaeda on the United States on the morning of September 11, 2001. The second was the Great Recession of 2008-2009 – an event brought on by a sudden jump in the price of light oil to an eye-popping price of US$145 per barrel.

You will notice that the most recent bull market began roughly six years ago. Since bull markets generally last for about 15 years, investors have time on their side.

My comments on stocks are not buy-or-sell recommendations, of course. Their only purpose is to describe certain stock patterns and ideas, using current illustrations.