Since the February 2009 low the US stock market has been on a tremendous bull market. Returns roughly around 12% compound. But that's the S&P 500.

The NASDAQ has gone from around 2000 to 20,000. That is not a typo. That equates to roughly 15% compound per year and doubling you money every 5 years. A truly spectacular performance.

But we repeat ad nauseam, markets cycle and nothing shows it better than the past performance of the NASDAQ. 

In 1998 after a stellar 15 year run, the NASDAQ in 1998 rose about 30%. In 1999 it doubled! From 4,000 to 8,000. But that was where the party stopped. In 2000 it lost about 30%, in 2001 about 25% and in 2002 around 30%. This left it back around 2000, where it was in mid 1995. So 5 years of party and 3 years of pain left you no better off over 8 years. So much for buy and hold. From 2003 to 2007 it doubled and then again lost 50% to find itself again in 2007 at 2000. So now we have a 1995 to 2007 period where the NASDAQ went nowhere. It is astonishing to think anyone would be sane after that 12 year performance. 

But from 2009, the NADAQ recovered and as I mentioned it rose from 2,000 to now 20,000. A serious bull market.

But should you buy and hold once you understand the market history and the crushing volatility? 

Do you think this party will continue for ever?

Do you think, given history that these might be dangerous times? 

It's always fun to make money but as the NASDAQ shows it can disappear in very quick time. And it can be brutal to watch a portfolio that has made historically large returns vanish almost overnight.

I'll leave you to calculate the 30 year return, but one thing I can tell you is there is a reason why we harp on about market cycles.