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Should I Invest in the Stock Market During Covid-19?

Should I Invest in the Stock Market During Covid-19?

By Andrea Bereznak CRPC and Troy Dolphus Gilchrist

When investment professionals are asked this question, their gut instinct is to instantly reply “Over the long run, broad exposure to the stock market provides excellent returns.” What are these returns exactly? Using the S&P 500 as the “stock market” between July 1, 1928 to July 1, 2020 the S&P 500 has had a compounded annualized growth rate of 5.7%. In other words, investment professionals expect a 5.7% return in any given year on the money contributed to the broad market. 

However, for most people these returns alone are not truly comforting. Our true fear is that the instant we invest, our accounts will start to lose money. In fact, many of us know friends or family who lost hard earned money during the 2008 Great Recession and failed to recover because they withdrew funds when the market was down. During the present time, the uncertainty feels very similar with the added issues of an unprecedented global pandemic. 

Think Long-Term

When reframing the question with that fear in mind, the most important aspect to consider is the timeframe you are investing for. Let us assume you invest $100,000 in the S&P 500 today, but when you check your account in a month you now have $95,000 or even less because the market dropped due to on-going Covid-19 concerns. The table below shows what your expected annualized growth rate is if you simply leave your investment after an initial drop of <5%. It also shows the chance that you would never earn more than $100,000 over those time periods. While the returns are not guaranteed, they indicate how time is a crucial factor to consider. If you need the funds you are considering investing within 2 years, the stock market is probably too risky. However, if you plan to invest for retirement in 10, 20, or 30 years, your original $100,000 could grow to $731,600.47. 

Learning From the Past


1 Year

3 Year

5 Year

10 Year

20 Year

30 Year

Expected Yearly Return







 % Lost Money Over That Period








Amazingly, the results above assume you invest at the highest peak right before The Great Depression, The Oil Crisis, The Tech Bubble Crash, and the Great Recession. Even during volatile times, the stock market has great potential over the long run

If you are interested in learning how to invest in the stock market in a way that is appropriate for your unique goals, reach out to a Rayhons Financial advisor today! Call us at (480) 507-2425 or contact us online

Troy Dolphus Gilchrist is a Non-Registered Associated Person with Voya Financial Advisors. Troy cannot offer securities or advisory services.



The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Voya Financial Advisors. Comments concerning the past performance of [e.g. monetary instruments, investment indexes or international markets] are not intended to be forward looking and should not be viewed as an indication of future results.