Do Stocks Rise More Than They Fall? Comparing the NGX, S&P 500, and Nasdaq Over 10 Years (2016–2025)

Introduction

Ask many investors why they avoid stocks, and you will hear a familiar answer:

“The market is too risky.”

For many, stock investing feels like a constant battle against bad news:

• Market crashes
• Inflation
• Recessions
• Currency weakness
• Geopolitical tensions
• Interest rate hikes

And because painful market declines are emotionally memorable, many people assume stock markets fall more often than they rise.

But is that actually true?

To answer this question, we analyzed roughly 10 years of trading activity (2016–2025) across:

• The Nigerian Exchange (NGX)
• The S&P 500
• The Nasdaq Composite

The findings reveal something surprising:

All three markets rose more often than they fell.

But the similarities end there.

Because while the NGX delivered the highest percentage of winning days, the US markets delivered smoother compounding and lower volatility.

And that distinction teaches one of the most important lessons in investing.

The Big Surprise: Markets Rise More Often Than They Fall

Over the last decade, all three major markets maintained a structural bias toward green days.

10-Year Market Breadth Comparison (2016–2025)

Market Trading Days Up Days Down Days Up-Day Bias

NGX ~2,440 ~1,453 ~995 59.5%

S&P 500 2,520 ~1,398 ~1,122 55.5%

Nasdaq 2,520 ~1,395 ~1,125 55.4%

At first glance, the result is surprising:

The NGX Had More Winning Days Than the S&P 500 and Nasdaq

Yes — over the decade, the Nigerian market recorded more advancing sessions than both major US indexes.

In simple terms:

For every 10 trading days:

• The NGX rose about 6 days
• The S&P 500 rose about 5½ days
• The Nasdaq rose about 5½ days

That is not what most investors expect from a frontier market, often described as volatile or risky.

So what explains this?

A Tale of Two Different Market Worlds

Although these markets all showed a long-term upward bias, they behaved very differently.

The NGX: A Market of Extreme Policy Cycles

The Nigerian market moved in dramatic, policy-driven waves.

2016–2019: The Difficult Years

The first half of the decade was painful.

Out of four years:

• Three were negative
• Down days dominated
• Investor confidence weakened

2016: Recession and Oil Price Shock

Nigeria entered recession after the global oil price collapse.

Foreign investors struggled with severe dollar shortages.

Market return: -6.17%

Market breadth:

• Up Days: ~108
• Down Days: ~136

2017: The Great Rebound

Then came one of the strongest rallies in modern NGX history.

The introduction of the Investors & Exporters (I&E) FX Window restored confidence and liquidity.

Banking and industrial stocks surged.

Market return: +42.30%

Market breadth:

• Up Days: ~154
• Down Days: ~91

2018–2019: Back to Weakness

Election uncertainty, capital flight, and global tightening pressured equities again.

2018

• Return: -17.81%
• Up Days: ~99
• Down Days: ~144

2019

• Return: -14.60%
• Up Days: ~104
• Down Days: ~140

For many investors, this reinforced the belief that the NGX was simply too unpredictable.

But then everything changed.

The NGX Structural Reversal (2020–2025)

Beginning in 2020, the Nigerian market entered one of the strongest multi-year runs in its history.

Six Consecutive Positive Years

• 2020: +50.03%
• 2021: +6.07%
• 2022: +19.98%
• 2023: +45.90%
• 2024: +37.65%
• 2025: +51.19%

This period fundamentally transformed the market.

What Changed?

Inflation Became an Unexpected Tailwind

Historically, inflation and currency weakness scared investors away.

But in Nigeria, the opposite increasingly happened.

Large local institutions — particularly Pension Fund Administrators (PFAs) — faced a difficult reality:

• Foreign investing restrictions
• Weak real returns in fixed income
• Persistent inflation eroding purchasing power

As a result:

Stocks Became an Inflation Hedge

Domestic institutional money increasingly flowed into blue-chip Nigerian equities.

This local demand helped cushion the market and reduce prolonged periods of weakness.

In short:

Local investors quietly changed the structure of the NGX.

The US Markets: Consistent Compounding Machines

Unlike the NGX, the S&P 500 and Nasdaq followed a more predictable rhythm.

Their movements were driven largely by:

• Federal Reserve interest rates
• Corporate earnings
• Global liquidity cycles
• Technology innovation

The S&P 500: Stability Through Diversification

Because the S&P 500 contains 500 major companies across sectors, it tends to maintain a consistent baseline of positive days.

Even during difficult years, diversification softens extreme swings.

Example: 2022 — The Great Inflation Shock

When the Federal Reserve aggressively raised interest rates, stocks suffered.

S&P 500 (2022)

• Return: -19.44%
• Up Days: ~108
• Down Days: ~144

But even during one of its worst years in decades, the market avoided total structural collapse.

The Nasdaq: More Reward, More Pain

The Nasdaq behaves differently.

Because it is heavily concentrated in technology stocks, its gains — and losses — tend to be more explosive.

The COVID Tech Boom

2020 Nasdaq

• Return: +43.64%
• Up Days: ~148
• Down Days: ~104

Tech companies benefited massively from:

• Remote work
• Digital transformation
• Cloud computing
• E-commerce growth

Then Came 2022

The Nasdaq experienced one of its harshest sell-offs in years.

Nasdaq (2022)

• Return: -33.10%
• Up Days: ~102
• Down Days: ~150

Cheap money disappeared.

Tech valuations collapsed.

This was effectively the mirror opposite of 2020.

The Hidden Truth About Market Breadth

Here is the biggest lesson from this entire study:

More Up Days Does NOT Automatically Mean Better Returns

This is where many investors misunderstand markets.

The NGX recorded the highest percentage of winning days.

Yet the US markets still produced extraordinary long-term wealth creation.

Why?

Because:

The Magnitude of Gains Matters More Than the Frequency of Gains

A market can:

• Rise frequently but modestly
• Or rise less frequently but explosively

The Nasdaq is a perfect example.

Its up/down day ratio looked almost identical to the S&P 500.

But because of powerful tech rallies — especially during the AI-driven surge of 2023 — its total gains were dramatically stronger.

Investing Lesson:

Winning frequency matters. But winning magnitude matters even more.

What This Means for Nigerian Diaspora Investors

For diaspora investors deciding between Nigerian and US stocks, the lesson is not:

“Choose one market.”

Instead, it may be:

“Understand the role each market plays.”

The NGX May Offer:

✔ Strong inflation hedge potential
✔ Deep value opportunities
✔ Dividend income potential
✔ Exposure to local economic growth

US Markets May Offer:

✔ Global diversification
✔ World-class companies
✔ Technology-driven growth
✔ Smoother long-term compounding

Many sophisticated investors combine both.

This is why disciplined portfolio construction matters.

How Smart Investors Find Opportunities

Whether investing in Nigeria or globally, successful investors rarely guess.

They rely on:

• Market trends
• Momentum signals
• Earnings quality
• Valuation metrics
• Technical indicators
• Sector leadership

The Nigeria Stocks Screener by TopChor helps investors identify potential NGX opportunities, compare stocks, and screen for market strength more intelligently.

Explore it here: https://topchor.com

Final Thought: Markets Reward Patience More Than Fear

The stock market rarely feels comfortable.

Fear dominates headlines.

Volatility shakes confidence.

But the decade-long evidence reveals a powerful truth:

Markets Rise More Often Than They Fall

The NGX, S&P 500, and Nasdaq all showed a structural long-term upward bias.

The difference is simply how they rise.

Some markets rise through explosive innovation.

Others through local economic repricing.

Others through policy-driven momentum.

But history consistently rewards investors who stay disciplined long enough to let compounding work.

Because in investing:

Temporary fear is common. Long-term progress is where wealth is built.