It Could Be Worse

Includes: SPY
by: Bespoke Investment Group

If the hour to hour up and down moves from the market in reaction to headlines coming out of Washington have you frustrated, just remember that it could be a lot worse. The chart below shows the S&P 500's absolute average daily percentage move over a 50-trading day rolling period since 2011. As a result of the stalemate in Washington, the S&P 500's average daily percentage move has increased from +/-0.43% up to +/-0.55% since mid-September.

Looking at the chart below, even after the recent uptick in the average daily move of the S&P 500, it is still less than a third of the day-to-day volatility (+/-1.92%) that we saw back during the 2011 debt ceiling debate. In fact, it is actually much closer to its lows of the last three years than it is to its highs. It may be raining now, but it is far from pouring.