The Market Crash Report · event-triggered, measured, anchored in history
When the next dislocation comes, this is what we will publish.
Every long-horizon investor will live through a market dislocation. A 20% drawdown, a recession announcement, a geopolitical shock, a sudden regime shift. The data says it happens, on average, every five to seven years. The behavioral data says investors who panic during dislocations cost themselves more compounded return than every other mistake combined. This report exists because that one fact deserves a calm, standing answer rather than an emergency response in real time.
We do not publish the Market Crash Report on a calendar. We publish it when a real event warrants it. Most years the publication will be quiet. That restraint is what gives it weight when it does fire. When you receive an issue, the event has cleared a threshold our methodology takes seriously. The issue itself will be measured, historical, anchored. No urgency. No prediction about what comes next. No telling you what to do with your money. Just the data and the framing.
What this publication is, and what it is not.
What this publication IS: a standing reference for major market dislocations. When a 20% drawdown materializes, a recession is announced, or a regime shifts, we publish an issue that explains what happened, where it sits in 75 years of historical context, what investors have typically done at moments like this, and what our methodology says to do about it. The whole framework anchors in data, not opinion.
What this publication IS NOT: a market-timing service. A recession call. A buy or sell signal. We will never tell you to act based on what we publish here. We are a publisher operating under the Section 202(a)(11)(D) exemption, not an investment adviser. The Market Crash Report exists to give you the data and the frame so you can decide for yourself, with calmer ground than the financial media will give you.
The publication also exists because we know what most members do during dislocations. They scroll headlines. They watch portfolio values. They consider doing something. The behavioral evidence on what comes next is unambiguous. Our job, as a research publisher, is to be the place an investor can land when the headlines start to crowd out the data. Calm context, on standing reference, on demand.
Every issue of this report will include historical analogs to the current event. Drawdowns and recoveries from comparable past dislocations. Time-to-trough, time-to-full-recovery, and the macro context of each. The point of the analogs is not to predict what comes next. The point is to give you a base rate. Most dislocations look unprecedented while they are happening and look obvious in hindsight. The analogs make the unprecedented feel less unprecedented.
The introduction issue does not list analogs because no specific event has triggered it. When the next real event fires an issue, the analogs section will be populated. Members can also find the underlying drawdown distribution data, free, in our Market Normality Indicator and Seasonality research.
Dalbar's longitudinal investor-behavior research has documented the same pattern across decades. The average equity investor underperforms the funds they own by four to six percentage points per year. The gap comes almost entirely from when they buy and when they sell. The funds did not fail. The investors timed themselves out of the returns. The largest mistakes happen at exactly the moments dislocations make most tempting.
Loss aversion is the proximate cause. The pain of a 30% drawdown is psychologically asymmetric to the pleasure of a 30% gain. The brain wants to act on the pain. The action it suggests is almost always selling. The action that compounds long-run wealth is almost always not selling. Recognizing this asymmetry in advance, while the market is normal, is the cheapest insurance an investor can buy. Reading about the asymmetry while the dislocation is happening is the second-best version.
There is also a hindsight problem in the opposite direction. After a recovery, investors look back and think they should have bought more at the bottom. The data says identifying the bottom in real time is roughly chance, and the investors who tried usually bought too early, watched their additional capital draw down further, then sold out at a worse moment than if they had not acted at all. Our methodology does not try to time bottoms. It runs the process across cycles.
What our methodology says to do during a dislocation is rarely satisfying in the moment. The honest answer is: continue running the process. Our portfolios rebalance on a fixed calendar. The schedule does not change because the market is loud. The thesis-based sell triggers do not change. The quality and valuation screens do not change. The institutional flow signal does not change. The methodology was built to be the same methodology in calm markets and in dislocated markets. That is what makes the long-run returns the long-run returns.
If you hold our portfolios, the right action during a dislocation is almost always no action. The rebalance will come on its calendar. If the dislocation has changed any of the underlying business cases for the positions we hold, we will address that at the next rebalance with the trade list and the per-position reasoning. The Pro Weekly and Trade Alerts cover the implementation. This report covers the framing.
We are not investment advisers. Individual investors with specific tax situations, account constraints, liquidity needs, or risk tolerances may legitimately make different decisions than the model portfolios do. We cannot give that personal guidance. What we can do is publish the data, the historical context, and the methodology so you can make the decision with calmer ground than financial media will give you.
When the next issue of this report lands in your inbox, that means something real has happened in the market. The issue will be longer than this one. It will include analogs, drawdown data, behavioral framing tied to the specific event, and a section on what our methodology is doing in response (usually: continuing). Until then, the methodology runs in the background. The Sunday Brief lands every Sunday morning. The Pro Weekly lands every Thursday for members. Quarterly rebalances happen on schedule.
If you would like to be ready when the next event happens, the things that help most are not market-timing tools. They are knowing your own risk tolerance honestly, holding positions sized so a 30% drawdown does not threaten your sleep, and having a process you can run without checking the headlines every day. All of that is buildable. None of it requires guessing what the market does next.
Be calm when the next one happens.
Future issues land in your inbox when an event warrants it. Until then, the Sunday Brief covers the steady state, free, every Sunday morning.
Subscribe freeEducational research from Advising Alpha. We are a publisher under Section 202(a)(11)(D) of the Investment Advisers Act of 1940, not a registered investment adviser. The Market Crash Report exists to provide data and editorial context during market dislocations. It is not investment advice, a buy or sell signal, or guidance on what to do with your money. Past performance does not guarantee future results. Full disclaimer at advisingalpha.com/disclaimer.