The best days in the stock market often arrive in the middle of a crash, turning a terrifying selloff into a spectacular rebound before frightened investors can react.

The Stock Market’s Best Days Arrive When Everything Looks Terrible

Finance Investing by Léa Valmont

On April 9, 2025, the S&P 500 surged 9.5% in a single trading session. It was the index’s biggest daily gain since the 2008 financial crisis, and it happened in the middle of a market panic.

Just days earlier, investors had been dumping stocks as President Donald Trump’s sweeping tariff announcements triggered fears of a global trade war. The market was falling, recession warnings were multiplying, and the idea of buying stocks seemed increasingly reckless.

Then Trump announced a 90-day pause on many of the new tariffs. Wall Street exploded higher.

Anyone who had sold in fear and waited for the situation to become clearer risked missing one of the most profitable trading sessions in modern market history.

That extraordinary day illustrates a much broader statistical pattern. According to research published by Hartford Funds, approximately three-quarters of the best days in the stock market occur during bear markets or in the earliest stages of a recovery.

The implication is unsettling. Some of the most important days for building long-term wealth arrive precisely when investors have the strongest reasons to stay away.

But there is a catch that the financial industry rarely emphasizes with equal enthusiasm: the worst trading days also occur during those periods of extreme uncertainty. Avoiding them would have an even more dramatic effect on long-term returns.

Understanding both sides of the equation reveals why market timing is so difficult—and why the familiar advice to stay invested is more complicated than it first appears.

Table of Contents

Why the best days in the stock market happen during bear markets

Bull markets are supposed to be good for investors. Bear markets, generally defined as declines of at least 20% from a recent peak, are supposed to be bad.

That distinction works reasonably well when examining long periods. It becomes much less reliable when looking at individual trading sessions.

According to a Hartford Funds analysis of the S&P 500’s 50 best trading days between 1996 and 2025, 48% occurred during bear markets. Another 28% happened during the first two months of a new bull market.

Combined, those categories account for 76% of the index’s strongest daily gains.

Only 24% occurred during the remainder of bull markets, when conditions were comparatively more favorable.

The pattern is striking because it reverses the emotional logic of investing. The periods that feel most dangerous frequently contain the largest upward moves.

There is a statistical reason for this.

During a crisis, investors rapidly reassess economic conditions, corporate earnings, interest rates and financial risks. Prices move violently because uncertainty is unusually high and expectations can change within hours.

When a feared outcome becomes less likely, even temporarily, markets can recover with extraordinary speed.

A surprise policy announcement, an unexpected central bank decision or evidence that a financial crisis may be contained can trigger an enormous rally.

And those developments often occur before investors feel confident that the danger has passed.

The precise percentage depends on the sample and methodology. Hartford Funds’ currently available research, citing Ned Davis Research for 1995–2024, reports approximately 78% rather than 76%. The broader conclusion remains consistent: exceptional positive trading days are heavily concentrated around periods of market distress.

This distinction matters because the statistic is historical, not a forecast. It does not mean that any particular day in a bear market is likely to produce an extraordinary gain, or that buying immediately after a decline guarantees a profit.

It means that the most powerful rebounds have frequently occurred when confidence was still extremely weak.

How missing just 10 trading days can destroy decades of returns

The financial consequences of missing those rebounds can be enormous.

In a Hartford Funds analysis covering 1996 through 2025, a hypothetical $10,000 investment in the S&P 500 grew to $192,167 when it remained invested throughout the period.

Remove the 10 best trading days, and the ending value falls to $85,490.

That’s approximately 56% less wealth from missing just 10 sessions over three decades.

The same historical comparison becomes increasingly dramatic as more of the strongest days are excluded.

Investment scenario Ending portfolio value
Fully invested, 1996–2025 $192,167
Missing the 10 best days $85,490
Missing the 20 best days $49,551
Missing the 30 best days $31,123

These figures, reproduced in contemporary summaries of Hartford’s research, illustrate the mathematical importance of a small number of exceptionally strong sessions. They should not be confused with a separate Hartford webpage that currently displays a different $10,000 growth figure using its own presentation and methodology.

The arithmetic is powerful because investment returns compound.

Imagine that a portfolio loses 20%. It now needs to gain 25% merely to recover its previous value.

If an investor sells after the decline and misses a substantial part of the rebound, the portfolio loses the opportunity to compound from those higher prices.

Over decades, missing a relatively small number of unusually profitable sessions can create a substantial gap in final wealth.

There is another important detail in the famous missing-best-days calculation.

It is a hypothetical exercise performed with perfect hindsight. The analysis identifies the strongest sessions after they have occurred and then removes them from the investment record.

Real investors cannot know in advance which sessions will qualify.

Nor does the calculation establish that every investor who temporarily exits the market will miss exactly those days.

Its real value is demonstrating how sensitive long-term results can be to a handful of extreme market moves.

April 9, 2025: A historic rally in the middle of a panic

The tariff crisis of April 2025 offers an unusually clear example.

On April 2, the Trump administration announced sweeping new import tariffs. Financial markets responded with a severe selloff as investors attempted to estimate the potential consequences for global trade, inflation, corporate profits and economic growth.

The following sessions were chaotic.

By April 9, however, the administration announced a temporary pause on many of the new tariffs.

The reaction was immediate.

The S&P 500 climbed approximately 9.52%, its largest one-day percentage gain since October 2008. The Nasdaq Composite surged more than 12%, while the Dow Jones Industrial Average jumped almost 8%.

The rally was enormous, but it did not arrive after a prolonged period of reassurance.

It arrived while investors were still struggling to understand what the administration would do next.

The following session brought another sharp reversal, demonstrating that the underlying uncertainty had not disappeared.

For an investor attempting to avoid the turmoil, the sequence created a brutal problem.

Selling after the initial tariff shock might have protected against further declines. But remaining outside the market on April 9 meant missing an extraordinary rebound.

Returning immediately afterward required making another decision while volatility remained elevated.

This is the central difficulty with market timing. An investor must get two decisions right: when to leave and when to return.

Even a correct assessment that market risks are elevated does not automatically produce a profitable trading strategy.

The market can rise sharply while the economic outlook remains poor, just as it can fall despite apparently encouraging news.

Prices respond to changes in expectations, not simply to whether conditions are objectively good or bad.

The other side of the story: What if you avoided the worst days?

The missing-best-days argument is widely used by investment firms to discourage investors from selling during downturns.

The numbers are persuasive. They are also incomplete.

Bank of America examined a much longer historical period, beginning in 1930, and compared the consequences of removing the strongest and weakest trading sessions from each decade.

In a version of the analysis covering roughly nine decades through March 2022, the S&P 500 generated a cumulative price return of approximately 19,975% when an investor remained fully exposed.

Removing the 10 best trading days from every decade reduced that cumulative return to just 45%.

But reversing the experiment produced an even more spectacular result.

Removing the 10 worst trading days from every decade increased the hypothetical cumulative return to approximately 4,275,143%.

Those figures are percentage gains, not final dollar balances. They also come from a different historical period and methodology than Hartford’s 1996–2025 illustration.

The distinction is essential. Bank of America’s exercise removes 10 days per decade, not merely 10 days across the entire sample, and the reported figures concern price returns rather than a dividend-reinvested total-return portfolio.

The comparison nevertheless exposes the weakness in the usual presentation.

If missing the best days is devastating, avoiding the worst days is extraordinarily beneficial.

In the same historical analysis, removing both the 10 best and 10 worst days of each decade produced a cumulative return of approximately 30,678%, exceeding the 19,975% buy-and-hold result.

That does not establish a practical trading strategy. It establishes that the familiar best-days chart is a selective thought experiment.

An investor with perfect advance knowledge of the worst sessions could improve returns enormously.

But perfect advance knowledge is precisely what investors lack.

The more interesting question is whether a realistic strategy can reduce exposure to major losses without sacrificing too many recoveries.

That is a much harder problem than removing dates from a spreadsheet after the fact.

Why the best and worst market days arrive together

The apparent contradiction disappears once we understand volatility.

Volatility measures how widely investment returns fluctuate. When volatility rises, the market becomes more likely to experience unusually large moves in either direction.

Financial crises create exactly those conditions.

Investors disagree sharply about the future. Liquidity can deteriorate. Hedge funds and other leveraged investors may be forced to sell assets. Policy announcements can suddenly change expectations.

As a result, large declines and large rebounds frequently occur within the same turbulent periods.

Consider the 2008 financial crisis.

The S&P 500 experienced some of its worst daily losses during the collapse of confidence in the banking system. Yet October 13, 2008, also produced a gain of more than 11%, one of the strongest sessions in the index’s history.

That rally did not mark the end of the bear market.

The financial crisis continued, and stocks subsequently fell further before reaching their eventual bottom in March 2009.

A similar pattern appeared during the COVID-19 crash in 2020. Markets suffered extraordinary losses in March, but some of the largest positive sessions also occurred while the pandemic’s economic consequences remained deeply uncertain.

This is why the simple instruction to sell when things look dangerous can produce disappointing results.

By the time the danger is obvious, much of the decline may already have occurred.

And by the time conditions appear safe again, a substantial part of the recovery may already be reflected in market prices.

There is no reliable calendar separating the bad days from the good ones.

They often belong to the same episode.

Why these statistics don’t prove that market timing is impossible

There is an important difference between saying that market timing is difficult and claiming that it is mathematically impossible.

The missing-best-days statistics do not prove the latter.

Some investment strategies deliberately adjust market exposure based on trends, volatility, valuations or economic conditions. Certain systematic approaches have historically reduced losses during particular downturns, although they can also lag during recoveries or suffer prolonged periods of underperformance.

For example, a trend-following strategy might reduce equity exposure after a sustained decline and rebuild it once prices begin recovering.

That approach may help during prolonged bear markets.

But it can struggle when prices fall and rebound rapidly, because the strategy may sell after the initial decline and buy back only after much of the recovery has occurred.

The outcome depends on the rules, trading costs, taxes, market conditions and the investor’s ability to follow the strategy consistently.

The Bank of America comparison also highlights a deeper mathematical issue.

Large positive and negative returns have asymmetric effects on wealth. A 50% loss requires a subsequent 100% gain to recover. Avoiding a severe decline can therefore have an enormous influence on long-term compounding.

This explains why protecting against large losses can be valuable.

But a strategy must identify those losses before they occur, not retrospectively.

And any claim of successful market timing should be evaluated using realistic assumptions, including transaction costs, taxes, dividends and performance across different market environments.

A hypothetical portfolio that avoids the worst days with perfect foresight is not evidence that ordinary investors can reproduce the result.

The same criticism applies to a hypothetical portfolio that somehow misses only the best days.

Both exercises are useful demonstrations of compounding. Neither is a complete test of an investable strategy.

What long-term investors can actually learn

The most useful conclusion is not that investors must remain fully invested in stocks under every circumstance.

A portfolio should reflect the investor’s time horizon, financial needs and capacity to absorb losses.

Someone saving for retirement several decades away faces a very different problem from someone who needs the money to purchase a home next year.

For a long-term investor with diversified holdings and sufficient financial reserves, attempting to escape every market decline may create more problems than it solves.

A disciplined investment plan can reduce the temptation to make repeated decisions based on short-term fear.

One approach is dollar-cost averaging: investing a predetermined amount at regular intervals, regardless of current market conditions.

This allows investors contributing from ongoing income to accumulate assets without trying to identify the perfect entry point.

It does not guarantee higher returns than investing an available lump sum immediately. Money invested earlier generally has more time to participate in market gains, and regular investing does not protect against losses.

Its practical advantage is behavioral.

An investor who follows a predetermined schedule has fewer opportunities to abandon a long-term strategy in response to frightening headlines.

Diversification serves a different purpose.

Holding a mixture of assets can reduce dependence on any single company, sector or market outcome. Bonds, cash reserves and other investments may help manage portfolio risk, although correlations can change and diversification cannot eliminate losses.

Rebalancing can also help maintain a chosen level of risk.

If equities rise substantially and become an excessive share of a portfolio, rebalancing may involve selling some stocks and restoring exposure to other assets.

After a severe decline, the reverse may be necessary.

Unlike an attempt to predict the next market crash, this process is driven by portfolio allocation rules.

The objective is to manage risk consistently rather than forecast individual trading sessions.

The most important decision often happens before the crisis begins.

An investor who takes on more risk than they can tolerate may be forced to sell during a downturn, regardless of how compelling the long-term investment case remains.

A sustainable strategy is one that can survive unfavorable market conditions without requiring heroic emotional discipline.

The real danger is needing to predict the next trading day

The stock market has an irritating habit of delivering its most spectacular gains when the economic headlines look disastrous.

Hartford Funds’ historical analysis suggests that roughly three-quarters of the strongest S&P 500 sessions have occurred during bear markets or near the beginning of recoveries.

Missing a small number of those sessions can dramatically reduce long-term investment results.

Yet the opposite calculation is equally revealing. Avoiding the worst sessions would have produced even greater hypothetical benefits in Bank of America’s historical study.

Both observations are true.

And together they explain why the familiar debate between staying invested and timing the market is often framed too simply.

The best and worst days are concentrated in periods of extraordinary volatility. An investor attempting to avoid one group risks missing the other.

Successful market timing therefore requires more than correctly identifying economic dangers. It requires a repeatable method for managing exposure through unpredictable declines and rebounds.

For most long-term investors, a diversified portfolio, an appropriate level of risk and a consistent contribution schedule offer a more practical foundation than trying to anticipate the next dramatic trading session.

That approach does not eliminate market losses. Nor does it guarantee that remaining invested will always produce the best outcome.

It reduces dependence on a prediction that is extraordinarily difficult to make consistently.

The market’s biggest opportunities often arrive disguised as its worst moments. The problem is that its worst moments look almost exactly the same.

Sources and further reading