If you had told a regular investor back in 2016 that we were about to hit a decade featuring a global pandemic, the highest inflation in forty years, and a weirdly obsessed fascination with computer chips, they probably would’ve sold everything and bought a farm. Honestly, it sounds like a bad movie plot. But here we are in early 2026, and the reality is that the stock market in last 10 years has been an absolute juggernaut, rewarding those who stayed the course with returns that frankly don't make sense on paper.
The S&P 500 has basically been on a tear, compounding at about 13.5% annually over the last decade (excluding dividends). If you include those dividends, you're looking at a total return north of 320%. It’s wild. We’re talking about a period where the index grew from the 2,000 range in early 2016 to nearly touching 7,000 recently.
But it wasn't a straight line. Not even close.
The Era of Cheap Money and the COVID Whiplash
The first half of this ten-year stretch was defined by "easy" conditions. Interest rates were basically on the floor, and the "FAANG" stocks (Facebook, Apple, Amazon, Netflix, Google) were the only names anyone cared about. Then 2020 happened.
Everyone remembers the March 2020 crash—that terrifying 30% drop in what felt like twenty minutes. But the recovery was even weirder. The Fed pumped so much liquidity into the system that by late 2020, we weren't just back to normal; we were in a speculative frenzy. You’ve probably forgotten about the SPAC craze or the "meme stock" era of 2021, but those were the symptoms of a market flush with cash and nowhere to put it.
Then came 2022. The "hangover" year.
As inflation started biting, the Federal Reserve realized they’d left the party going too long. They started hiking rates at the fastest pace in history. The S&P 500 tanked nearly 20%, and the tech-heavy Nasdaq got absolutely slaughtered, dropping around 33%. If you were looking at your 401(k) that December, you probably wanted to cry. It felt like the end of the "bull run" for good.
The 2023 Pivot: Why Everyone Was Wrong
Going into 2023, every expert on CNBC was predicting a recession. Literally everyone. But the recession never showed up. Instead, we got the "Magnificent Seven" and a little thing called ChatGPT.
The shift from 2022's gloom to 2023's 24% gain was driven almost entirely by the birth of the AI era. Suddenly, it didn't matter if interest rates were 5%. If you owned Nvidia, you were winning. This momentum carried right through 2024 (another 23% gain) and 2025 (up 17%).
How the Stock Market in Last 10 Years Changed the Rules
The old-school advice used to be about "diversification." But if you actually followed that in the last decade, you probably underperformed.
✨ Don't miss: Working With Other People: Why Most Office Advice Actually Fails
The reality of the stock market in last 10 years is that it has been incredibly top-heavy. As of late 2025, just a handful of companies—Nvidia, Microsoft, and Apple—controlled a massive chunk of the entire market's value. Nvidia’s rise alone is the stuff of legend; it grew from a niche gaming chip maker to a $4 trillion behemoth.
Here is a quick look at the annual price returns that defined this era:
- 2017: A smooth +19.4%
- 2018: The "Christmas Crash" year, ending down -6.2%
- 2019: A massive bounce back of +28.9%
- 2021: The height of the post-COVID stimulus, up +26.9%
- 2022: The inflation nightmare, down -19.4%
- 2024: The AI-fueled rally, up +23.3%
It’s been a decade of extremes. We’ve seen the "death of retail" and the subsequent "rebirth of the consumer." We saw oil prices go negative in 2020 and then rocket back up.
What Most People Get Wrong About This Decade
Most people think the market only went up because the government printed money. While that helped, the real driver has been earnings. Big Tech didn't just get more expensive; these companies actually started making billions more in profit.
Apple’s revenue didn't just grow; it nearly doubled in this window. Microsoft successfully transitioned everyone to the cloud. These weren't "bubbles" in the 1999 sense—they were high-growth machines that actually delivered the goods.
Looking Forward: Is 2026 the End of the Run?
We are currently seeing a bit of a shift. The Fed has finally started cutting rates again, which usually sounds like good news, but it's happening because the labor market is finally cooling off.
Goldman Sachs and Morgan Stanley are currently projecting a more "tempered" 2026. Most analysts are looking for a return in the 10% to 12% range. It's not the 25% we saw in 2024, but it’s still healthy. The big question is whether the "AI buildout" actually starts showing up in the bottom lines of companies outside of tech. If it does, the bull market has years left. If it doesn't, we might be looking at some "lost years" for the big indices.
📖 Related: USD to Indian Rupee: What Most People Get Wrong About the Exchange Rate
Actionable Steps for the Next Phase
If you've been riding the wave of the stock market in last 10 years, you're likely sitting on some massive gains. Don't just let them sit there without a plan.
- Rebalance the "Winners": If Nvidia or Microsoft now makes up 40% of your portfolio because they grew so fast, it might be time to trim a bit. You don't have to sell everything, but taking some chips off the table is just smart.
- Look Toward "Value": For most of the last decade, "value" stocks (boring stuff like banks and energy) were dead. But with rates stabilizing and the market getting expensive, these laggards are starting to look attractive again.
- Check Your Cash: In 2021, cash was trash. Today, you can still get decent yields in money market funds. Keep enough liquid so you don't have to sell your stocks if 2026 gets "choppy."
- Ignore the "Midterm" Noise: 2026 is an election year. History shows these years are usually volatile in the first half and rally in the second. Don't let a scary headline in June talk you into selling.
The last ten years taught us that the market is more resilient than we give it credit for. It survived a plague, a war in Europe, and 9% inflation. Betting against the US economy has been a losing game for a century, and that hasn't changed.