Robert Kavcic of BMO Capital Markets says that in
the post-war period, the S&P 500 has posted monthly declines of 10%
or more on 8 different occasions. In the month that followed, the index
has rebounded 6 out of 8 times, with an average gain of 3.8%. "The
biggest rebound was 16.3% in 1974, while the worst performance was an
8.5% decline in 1987," Kavcic says. Looking at a 6-month time horizon,
the S&P 500 has advanced on 7 out of 8 occasions, "rising an
average 14.9% - the biggest gain was 38% in 1998, while the lone
decline was an ugly 27% in 1973," he says.