How often does the S&P 500 dip — and how deep?

Since 1950, S&P 500 drawdowns have arrived on a remarkably regular schedule. Here is the short answer on each depth, how often it shows up, and what it should mean to a long-term investor:

What “every N years on average” actually means: across 76 years (1950 to today), we count each new peak-to-trough drop that crossed the listed depth before the index set a new all-time high. The frequency is the long-run rate — total years divided by that count — not a calendar. Some decades produce several; some produce none.

The numbers above told you how often each threshold gets crossed. The two below describe what actually happens once a decline crosses the −10% or −20% line: how far down the index typically reaches, and how long the round trip takes. The threshold is the entry ticket; the depth and duration are what the trip looks like once you are on it.

Every −30%+ decline since 1950 — six in seventy-six years:

Each row is one episode: the peak-to-trough drop reached before the index set a new all-time high. Price-only, dividends excluded.

Here is the part most investors get wrong. The market is not usually sitting at an all-time high. Since 1950, the S&P 500 has spent about 35% of all trading days at least 10% below its prior peak — and 16% of days at least 20% below.

A third of the time, in other words, the index is trading below a prior peak by enough to feel uncomfortable. Buying the dip is not mainly about catching a rare crash. It is about deciding in advance how you will behave during normal market weather, then having a rule that keeps you from improvising under stress.

Same data, different cut. The base rates above count new declines as they begin. This counts the share of trading days the index actually sat below a prior peak — time-under-water, not frequency of new dips.

You cannot know the exact day in advance — nobody can, and anyone who claims otherwise is selling something. What you can do is stop guessing and use a rule. A good signal does not predict the future; it waits for the conditions where past selloffs have exhausted themselves, then flags it.

Since 2016, the DoubleTrends™ engine has fired 7 times on the S&P 500 index. Every one of those fires happened in a panic or bear regime — the engine refuses to fire in calm or correction by design. The biggest landed at the COVID crash low (March 2020), the 2022 bear-market low (October 2022), the 2025 tariff selloff, and the March-April 2026 Iran-war drawdown.

Honest caveat: not every fire marks a generational entry. Some have been early; some happened on shallower stress that resolved without a deep test. The point is not that every alert is the perfect day to deploy capital — it is that the same disciplined rule was present at every moment the largest opportunities appeared, and absent the rest of the time.

Once you accept that drawdowns are routine, the question becomes how to measure them in a way that compares cleanly across time. Two coordinates do most of the work: depth — how far below the trailing one-year high — and duration — how long the market has been bleeding.

A 10% drop in two weeks is structurally different from a 10% drop over six months, even though both look identical in the headline. The Maximum Drawdown lens is just the discipline of looking at both axes at once, instead of letting the depth number stand alone.