how many stock market crashes have there been

How many stock market crashes have there been

How many stock market crashes have there been is a common question for investors, students and researchers. The short answer: there is no single definitive count. The total depends on what you call a “crash” (a sudden one‑day collapse vs. a prolonged bear market), which market index or country series you use, and the time period covered. This article explains the terminology, why counts differ, representative published tallies, a timeline of major U.S. episodes, frequency and severity statistics, causes and impacts, data sources, and a step‑by‑step method to produce a reproducible count.

As of June 2024, according to public compilations from sources such as Morningstar, Investopedia, MUFG and Wikipedia, different definitions produced different tallies — ranging from a few dozen 20%+ bear markets across long series to many more if flash crashes and regional episodes are counted separately. These representative numbers and methodological notes are summarized below so you can understand how answers to “how many stock market crashes have there been” are produced and how to make your own defensible count.

Definitions and terminology

Clear definitions matter when asking how many stock market crashes have there been. Below are commonly used terms and how they affect counting.

• Stock market crash: commonly used for very rapid, steep declines in equity markets. Crashes often refer to dramatic one‑day or multi‑day collapses (for example, a single‑day drop exceeding a large percentage). Many authors reserve “crash” for abrupt events such as October 19, 1987 (Black Monday) or flash crashes.

• Bear market: a more formal term in investing, usually defined as a decline of 20% or more from a prior peak (peak‑to‑trough). Bear markets can be rapid or prolonged and commonly span months to years. When counting historical episodes over long series, many researchers count bear markets rather than only one‑day crashes.

• Correction: typically used for declines between 10% and 20% from a recent peak. Corrections are frequent and often excluded from high‑level crash tallies unless the research question seeks to include shallower drawdowns.

• Peak‑to‑trough: the measurement method for bear markets — the percent decline from the local peak to the subsequent trough. Different approaches to identifying peaks and troughs (calendar month vs. daily series, for example) will change counts.

• Flash crash / one‑day collapse: very abrupt intra‑day or single‑day declines (and sometimes rapid rebounds). These are often cataloged separately from multi‑month bear markets.

• Recession‑associated vs. non‑recession bear markets: some counts tag bear markets that coincide with official economic recessions and treat them differently because the macroeconomic context affects severity and recovery.

Historic records and academic studies may treat abrupt one‑day events (flash crashes) differently from prolonged bear markets. A transparent count should state whether it includes only peak‑to‑trough 20%+ declines, one‑day collapses, or both.

Why counts differ — methodological issues

Several methodological choices change the answer to how many stock market crashes have there been:

1. Choice of index

• S&P 500, Dow Jones Industrial Average, Nasdaq Composite, or total‑market series (like CRSP or Wilshire) will yield different episodes. For example, technology‑heavy indexes show larger drawdowns in tech bubbles.

1. Start date of the dataset

• Longer series (19th century to present) produce many more episodes than modern post‑1929 series. Pre‑20th century data are sparser and require careful treatment.

1. Crash definition and thresholds

• Counting only one‑day crashes vs. counting all bear markets (20%+ declines) vs. including corrections (10%–20%) leads to much different totals.

1. Peak and trough identification method

• Daily series vs. monthly series; whether to smooth data; whether to require a minimum recovery before counting a new peak; and how to handle overlapping declines all affect totals.

1. Inflation adjustment

• Using nominal index levels vs. inflation‑adjusted (real) series can change the timing and perception of declines, especially across long historical periods.

1. Treatment of overlapping or prolonged episodes

• Some researchers merge nearby declines into one episode, others count separate episodes if there is a partial recovery above a threshold.

1. Geographic scope

• Global synchronized crashes (e.g., 2008, 2020) may be counted once or multiple times depending on whether national indices are tallied separately.

1. Data revisions and index reconstitutions

• Long historical series may be revised; index composition changes matter for older episodes and need transparent handling.

Common conventions used by prominent sources

• Morningstar often reports long‑run frequency and magnitudes using durable index series and a 20% threshold for bear markets.
• Institutional charts (e.g., MUFG) frequently present lists of 20%+ declines since 1929 for major U.S. indices.
• Finance press outlets (Investopedia, major newspapers) sometimes compile timelines mixing one‑day crashes and prolonged bear markets with narrative emphasis rather than strict counting rules.

Because these choices differ, answers to how many stock market crashes have there been must always include the counting rules.

Published tallies and examples from major sources

Representative published counts illustrate the range of answers to how many stock market crashes have there been:

• Morningstar and long‑run mutual fund research: As of June 2024, Morningstar and similar research teams that analyze long public equity series often identify roughly 15–25 bear markets (20%+ declines) for the U.S. market over the 20th and early 21st centuries, depending on start date and treatment of overlapping episodes.

• MUFG and institutional charts: As of June 2024, some institutional presentations (for example, MUFG charts widely circulated in the financial press) report about 26–27 bear‑market declines of 20%+ since 1929 for major U.S. indexes. Those charts define bear markets by calendar peak‑to‑trough percent decline and list each episode with dates and magnitudes.

• Finance press lists (e.g., Investopedia, major newspapers): Journalistic timelines typically list a smaller set of widely recognized “major crashes” (often 8–15 notable events) focusing on high‑impact episodes like 1929, 1987, 2000–2002, 2008, and 2020.

• Academic and long‑term datasets: Researchers using CRSP or other academic datasets that stretch to the late 19th century may identify a larger count (dozens) of 20%+ declines when including 19th‑century panics and regional market episodes.

These figures are representative examples, not a definitive count. Always check the original source for precise rules and dates when citing a tally in research or reporting.

Timeline of major U.S. stock market crashes (select notable events)

Below are succinct descriptions of widely recognized severe crashes and bear markets. This is not an exhaustive list but highlights episodes that commonly appear in public timelines and lists addressing how many stock market crashes have there been.

• 1929 Wall Street Crash / Great Depression (1929–1932): A deep, multi‑year decline following the 1929 peak; the worst economic contraction of the 20th century with profound global effects.

• 1973–74 bear market: Triggered by an oil shock, rising inflation and geopolitical tensions; large peak‑to‑trough losses in U.S. and global equities.

• Black Monday (October 19, 1987): One of the largest single‑day percentage declines in equity market history for major U.S. indices; markets fell dramatically in a single session.

• Dot‑com bubble burst (2000–2002): A prolonged bear market concentrated in technology and internet stocks, leading to large cumulative losses over multiple years.

• Global Financial Crisis (2007–2009): A severe systemic crisis led by collapses in housing finance and banking sectors; deep global equity declines and economic contraction.

• COVID‑19 crash (February–March 2020): A rapid, intense market collapse associated with the onset of the COVID‑19 pandemic and widespread economic shutdowns; notable for the speed of both decline and, subsequently, the rebound.

• Other notable rapid drops and regional episodes: Many other episodes appear on comprehensive timelines, including 19th‑ and early 20th‑century panics, regional banking crises, and country‑specific market collapses. Comprehensive lists from Investopedia, Wikipedia, Nasdaq and Moneywise include additional events going back into the 1800s.

One‑day/flash crashes vs. protracted bear markets

It is important to distinguish sudden one‑day collapses from multi‑month or multi‑year bear markets because lists and counts often separate them. Examples:

• Sudden one‑day collapses: Black Monday (1987) and the 2010 “Flash Crash” are cataloged for their speed and scale on a single trading day.

• Flash crashes (intra‑day collapses with rapid rebounds) are often listed apart from bear markets because their causes (algorithmic trading, liquidity gaps) differ from macro or credit‑driven bear markets.

• Protracted bear markets: The Global Financial Crisis and Dot‑com burst are multi‑year declines driven by systemic financial or valuation issues.

Some compilers include both types in a single timeline; others maintain separate categories. This choice affects answers to how many stock market crashes have there been.

Frequency, severity and typical statistics

Empirical regularities from published analyses help set expectations for how often and how severe crashes/bear markets are.

• Frequency: Over long horizons, analysts commonly find roughly one significant bear market (20%+ decline) per decade in major developed markets. The exact frequency depends on the historical window used.

• Average peak‑to‑trough decline: For counted 20%+ bear markets, historical averages often fall in the ~30%–35% range for the U.S. market. This varies by era (the Great Depression and Global Financial Crisis are outliers with larger declines).

• Median durations: Median durations of bear markets vary across analyses. Some institutional summaries report medians on the order of several months to a few years (for example, a median of roughly 240 trading days for certain U.S. bear markets in some MUFG‑style compilations). Exact numbers depend on the sample and peak/trough identification.

• Recovery patterns: The time from trough to prior peak (full recovery) varies substantially. Some recoveries are fast (months, such as post‑2020), while others take many years (e.g., markets following 1929 and the Dot‑com bust for certain sectors).

Caveats: sampling choices, era effects, valuation regimes, monetary policy and structural market changes (like algorithmic trading) all affect statistics. When answering how many stock market crashes have there been, always present the sample, period and definitions that produced the statistic.

Common causes and triggers

Crashes and bear markets typically arise from a mix of factors. Frequently cited contributors include:

• Asset bubbles and excess valuation: Large valuation gaps (e.g., the late 1990s tech valuations) can lead to sharp corrections when sentiment shifts.

• Leverage and credit stress: High leverage amplifies sell‑offs; banking or margin crises precipitate deeper declines.

• Macro shocks: Sudden shocks (oil price spikes, pandemics, unexpected rate hikes) can trigger market collapses.

• Monetary policy shifts: Rapid tightening of monetary conditions or surprise policy moves can expose vulnerabilities.

• Liquidity crises and market microstructure: Liquidity dries up in stressed markets, and fragile microstructure can create abrupt price gaps or flash crashes.

• Contagion and systemic failures: Failures of systemically important institutions can spread losses across markets and countries.

• Geopolitical events and large‑scale disruptions: While political shocks are not the only driver, major geopolitical disruptions can precipitate declines.

Most crashes are multi‑causal and context dependent. Research that counts episodes should document contributing factors per episode for nuance.

Economic and social impacts

Major crashes typically produce significant economic and social effects:

• Recessions or slowdowns: Severe equity declines often coincide with or precede economic recessions, as confidence and credit conditions tighten.

• Employment and income effects: Recessions following crashes can increase unemployment and reduce household income.

• Policy responses: Governments and central banks frequently respond with fiscal and monetary stimulus; responses shape recovery speed.

• Regulatory reforms: Some crises prompt regulatory changes (for example, post‑2008 reforms to banking rules).

• Behavioral effects: Crashes can change investor behavior — greater risk aversion, shift toward safer assets, and altered long‑term allocations.

These impacts underline why counting and studying crashes matters for policy makers and investors alike.

Recovery patterns and long‑term outcomes

Historical patterns show markets often recover and deliver positive returns over long horizons, but timing matters:

• Fast recoveries: Some crashes have been followed by rapid rebounds — the COVID‑19 crash of early 2020 is an example where aggressive policy support and fiscal stimulus contributed to a rapid market recovery.

• Long recoveries: Other episodes require years for full recovery. The post‑1929 period and some parts of the dot‑com aftermath produced protracted recoveries in real terms for many investors.

• Long‑term investors: Historical evidence shows broad market indexes tend to deliver positive long‑term returns despite intermittent crashes. However, individual sector or stock losses can be permanent.

• Role of diversification and rebalancing: Portfolio strategies that emphasize diversification, rebalancing and long‑term discipline historically have smoothed outcomes across cycles.

This context helps explain why the answer to how many stock market crashes have there been is important but not sufficient alone — investors also care about severity, duration and recovery.

Counting crashes globally and regionally

The same methodological issues apply when counting crashes across countries. Key points:

• Many national indices move together during global crises (for example, 2008 and 2020), but magnitudes and timing differ. Counting global crashes requires clear rules about whether to count synchronized declines as one event or multiple national events.

• Emerging markets and small national markets may have distinct structural drivers and higher volatility, producing more frequent deep drawdowns.

• Historical data quality for non‑U.S. markets varies; researchers should assess reliability before counting.

• For global tallies, some compilers count the number of national indices experiencing 20%+ declines in a given calendar year; others count distinct global episodes.

Because of these choices, global answers to how many stock market crashes have there been are even more contingent on methodology than single‑country counts.

Data sources and recommended references

Primary data and compiled sources commonly used to answer how many stock market crashes have there been include:

• Historical index series: S&P 500, Dow Jones Industrial Average, Nasdaq Composite, CRSP (for U.S.), Wilshire/FTSE series, and national indices for other countries.

• Academic datasets: CRSP, Global Financial Data, and other academically curated series for long horizons.

• Curated timelines: Wikipedia’s “list of stock market crashes and bear markets,” Investopedia timelines, and finance press compilations provide narrative contexts and commonly referenced dates.

• Institutional reports: MUFG, Morningstar, and other institutional research groups publish charts and counts with stated methodologies.

• Regulatory and historical accounts: Central bank and government historical reports for episodes like banking panics and systemic crises.

How to choose a data source

• Match the source to your question: for U.S. long‑run counts, CRSP or S&P 500 daily series are common choices; for global counts, use a consistent set of national indices.

• Evaluate data frequency, backfill practices and index composition changes for older periods.

• Prefer sources that document methodology and revisions so your count is reproducible.

Example approaches to produce a definitive count

Researchers can follow a reproducible procedure to compute a defensible answer to how many stock market crashes have there been. A suggested workflow:

1. Select the index and dataset: choose S&P 500 daily series, CRSP total‑market series, or a set of national indices; record the provider and exact series name.

2. Set start and end dates: document the period (for example, 1 Jan 1929 to 31 Dec 2023).

3. Define thresholds: decide whether to count 20%+ bear markets, 10%–20% corrections, and/or one‑day collapses. Specify exact criteria (e.g., 20%+ decline from peak to the lowest trough before a rebound of at least X%).

4. Peak and trough identification: decide if you will use daily closing prices, monthly series, or smoothed data. Implement a precise algorithm to find peaks (local maxima) and troughs (local minima) and handle noise.

5. Treatment of overlapping episodes: decide how much recovery between declines constitutes a new peak (e.g., a full recovery to the previous high, or a 20% rise from trough).

6. Inflation adjustment: decide whether to use nominal or real (inflation‑adjusted) series and document rationale.

7. Document edge cases: list how you will treat single‑day flash crashes, index reconstitutions, or partial recoveries.

8. Run the algorithm and produce a table listing episodes: start date (peak), trough date, percent decline, duration (days/months), and notes on causes/triggers.

9. Sensitivity analysis: repeat with alternative thresholds (e.g., 15% vs. 20%) or alternative peak/trough rules to show robustness.

10. Publish results with full methodology so others can reproduce the count.

Following such an approach yields a defensible answer to how many stock market crashes have there been for the selected dataset and rules.

See also

• Stock market crash
• Bear market
• Market correction
• Financial crises
• Market volatility
• Timeline of stock market crashes

References and further reading

As of June 2024, public compilations and institutional reports commonly cited in discussions of market crashes include: Morningstar historical analyses, MUFG institutional charts of 20%+ declines since 1929, Investopedia and Wikipedia timelines, and academic datasets such as CRSP and Global Financial Data. These sources document dates, magnitudes and methodologies used to count episodes. For precise tallies, consult the original publications and dataset documentation.

Appendix A: Recommended table structure for reproducible counts

Below is a suggested reproducible table to list episodes when answering how many stock market crashes have there been. Researchers should populate each row with verified data from their chosen series.

| Start (peak) | Trough | Index | Peak‑to‑trough decline (%) | Duration (days) | Notes / triggers | |--------------|--------|-------:|---------------------------:|-----------------:|------------------| | yyyy‑mm‑dd | yyyy‑mm‑dd | S&P 500 | -xx.x | xxx | e.g., oil shock, banking panic |

(Use daily closing prices and cite the data provider in your metadata.)

Appendix B: Notes on edge cases

• Partial recoveries and re‑peaking: some declines are followed by partial rallies that do not exceed the prior peak. Decide a rule for when a new bear market counts.

• Flash crashes: intra‑day collapses with quick rebounds can be recorded separately since their drivers are often market microstructure rather than macro fundamentals.

• Index reconstitution effects: for very old episodes, index composition changes can affect comparability with modern series.

• Global vs. national counts: document whether synchronized global episodes are aggregated as one event or multiple national events.

Further exploration and practical next steps

If you want a reproducible count for a particular index and period, follow the step‑by‑step approach above and use a documented historical series (for U.S. markets, CRSP or S&P 500 daily total return series are common choices). For hands‑on analysis, you can download the chosen dataset, apply the peak/trough algorithm, and generate the table format in Appendix A.

As of June 2024, public sources offer representative counts and timelines but differ by methodology. For those researching crashes, transparently reporting your rules is essential when answering how many stock market crashes have there been.

Explore Bitget resources to learn more about market data tools, wallet security and analytics that can help you track market behavior. To examine on‑chain indicators and market liquidity alongside traditional market indices, consider using Bitget Wallet for safe asset custody and Bitget’s marketplace tools for monitoring exchange activity and orderbook liquidity. These tools can complement historical index analysis without providing investment advice.

More practical reading and datasets are available from the references noted above; consult institutional charts and academic datasets for precise counts used in research and reporting.