Today’s Chart of the Day from Yahoo Finance shows the annual returns of the stock market by year for the last 40 years, which resulted in an average return of 12%.
It also denotes the maximum decline (pullback or drawdown) within that year with the orange dots and uses a dotted line showing these declines average 14%.
The difference between the average return of 12% and the average decline during the year of 14% reminds us that it is not unusual for the market to experience a range of 26% from low to high over a single year.