- Alan Chen
- Apr 24
- 4 min read
Updated: 7 days ago
Disclaimer: For educational purposes only, see full disclaimer.
In this post you're going to learn "when to" and "when NOT to" worry about daily market swings in the S&P 500 Index (the SPX or its ETF, the SPY).
Media headlines often exaggerate to click-bait you. They might say things like: "stocks plunge," "panics," or "market crash." A quick search on CNBC for "stocks plunge" yielded 13,985 results. That is enough to occupy you 38 years when reading one per day.
Today you are going to learn which market moves truly matters, with 6 insights to help you better understand daily market volatility.
At the end, you will apply what you learned and find out how bullish or bearish is the latest trade date for the S&P 500.
Like the Richter scale for earthquakes, let's size up the daily market moves.
Study of Daily Moves for SPX
The charts below are updated more frequently than the text, so refer to the charts for the most updated figures. Interactive charts available in desktop and tablet versions.
Average Daily Change in S&P 500
From 1999 to Apr 2025, the average daily change in S&P 500 is about +/- 0.8%. The exact range is -0.84% to +0.80%. The probability of gains (or win rate) is about 54%. The mean for all the gains and losses nets out to about +0.03% per day.
Doesn't the daily % change chart look like the readings of a Richter scale?
Let's make sense of it by transforming into the histogram below.
Normal Daily Change in S&P 500
After finding the average daily change in S&P 500, we then explore the typical range of stock market moves. I consider "normal" to be within 1 standard deviation of the dataset for daily change.
From 1999 to Apr 2025, a normal move in the S&P 500 is between -1.20 to +1.26%. Almost 80% of the data falls within this range.
Feel free to adjust the above data by dragging the date range bar (desktop and tablet versions only) and holding days you are curious about. Are the markets more volatile than 10 years ago? Let me know in the comments below.
Large Daily Change in S&P 500
From 1999 to Apr 2025, a large move in the S&P 500 is between +1.26% to +2.48% for gains and -1.20% to -2.42% for losses. This is between 1-2 standard deviations of the dataset.
Pro Tip: During Bull markets, these drops are often opportunities to buy the dip.
Extreme Daily Change in S&P 500
From 1999 to Apr 2025, an extreme move in the S&P 500 is more than +2.48% for gains and -2.42% for losses. This is exceeds 2 standard deviations of the dataset.
If the newspaper headlines calls this a stock plunge, I don't blame them.
Largest Moves Occurs in Bear Markets
Here are the top 10 best and worst daily changes. They ALL occur in bear markets. I defined bear markets as the price is below the 200-day moving average line.
Holding Longer Reduces Risk
The odds are better than 50-50 in the stock market, and way better than in the casino.
Holding longer than 1 day also increases the chance of success. The win rate improves to 57% if you hold for 5 trade days. The gains and losses range widens to -1.88% to +1.67%, with a better net change of 0.14% (vs. 0.03% for 1 day).
Latest Market Move for S&P 500
Below is the latest daily change in the SPX. With the histogram, we have already determined what is normal, large and extreme.
Let's reorganize the ranges in table form as the "Distribution Stats".
We define gains as bullish and colored in gold. Losses as bearish and colored in blue.
We will further refine extreme gains as Strong Bull, and large gains as Normal Bull. Vice versa, extreme losses will be Strong Bear, and large losses will be Normal Bear.
Statistical Range | Bull Bear Scale |
|---|---|
(+) Extreme >2 standard dev. | Strong Bull |
(+) Large 1-2 standard dev. | Normal Bull |
(+) Normal <1 standard dev. | Lazy Bull |
(–) Normal <1 standard dev. | Lazy Bear |
(–) Large 1-2 standard dev. | Normal Bear |
(–) Extreme <2 standard dev. | Strong Bull |
By applying the latest daily change to the table on the right, you can find out how bullish or bearish today's market is.
Taking Action
Now that you know what type of moves the market is capable of. You will know when to take action to buy the dip, cut losses, or take profit.
When there is a large or extreme move, review your portfolio. Keep your winners and say goodbye to your losers.
If you like to trade high growth stocks, be sure to read our resource on the NASDAQ 100 Index average daily moves. This index is widely known as the NDX or its ETF, the QQQ. They tend to move in a wider range when compared to the S&P 500, so don't panic when you see a larger move.
We hope this resource helps you invest wisely and steer clear of media bias.
Images in this post (accessibility)
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