Hidden Bear Index: Is the Average Stock Worse Off Than the Index?
The S&P 500 is cap-weighted, so a few mega-caps can hold it near highs while the broad market lags. The Hidden Bear Index compares two real drawdowns: the equal-weight S&P 500 (RSP) — the average stock — and the cap-weighted S&P 500, each measured from its own 52-week high. When the average stock falls far below the index, a correction is happening beneath a calm tape.
Today's answer
Hidden bear activeYes — a hidden bear is active inside the large-cap S&P 500. RSP is 5.5% below its 52-week high versus 0.2% for SPY, a 5.2-point shortfall. The broader listed-stock universe is weaker: the median eligible stock is 24.5% below its own high and 57% are more than 20% below theirs. The regime is Hidden Bear for 15 sessions; the RSP–SPY gap has narrowed by 1.4 points over 10 sessions. Similar Hidden Bear readings since 2010 led to +9.6% average six-month SPY returns, versus +6.2% across all regimes. That is historical context and does not time entries.
Sources, methodology & freshnessDaily closes for RSP and SPY, plus eligible US common stocks (roughly 4,750 in a typical session) for the dispersion read · Daily after US market close (~1pm PT)Data as of 2026-10-07 · Open ↓Close ↑
Today’s breadth split
The index-level comparison and the full stock universe answer different questions. RSP shows whether participation inside the large-cap S&P 500 is keeping up with SPY; the depth profile shows how much damage is still hidden among individual listed stocks.
All US Stocks: How Far Stocks Sit Below Their Own Highs
A cumulative depth profile: deeper bars are subsets of the shallower ones.
Share of 5,834 eligible common stocks, measured from each stock's own 52-week high.
The average stock vs the index
S&P 500 Equal Weight (RSP): Drawdown vs SPY
Both lines are real drawdowns from each series' own 52-week high, so both reach 0% at new highs. The “average stock” is the equal-weight S&P 500 (RSP) — every member counts the same, so it isn't carried by the mega-caps. When it sinks far below the cap-weighted S&P, the index is being held up by a shrinking set of leaders.
The typical stock in four universes
Each chart below reads the median stock's drawdown from its own 52-week high for one universe, against a cap-weighted fund for the same market. On 2026-10-07, the median S&P 500 member was 15.7% below its high, the median Nasdaq-100 member 17.3% and the median Nasdaq-listed stock 32.8%, while QQQ was 0.3% below its own 52-week high. A median stock always sits deeper than a fund of the same stocks, because each stock set its high on a different day. That is why the median S&P 500 member reads deeper than RSP in the chart above.
All US Stocks: Median Stock's Drawdown vs SPY
Every eligible US common stock with a full year of prices, 4,726 on 2026-10-07, read against SPY. On 2026-10-07 the median one was 24.5% below its 52-week high and SPY was 0.2% below its 52-week high; 57% of them sat more than 20% below their own highs.
S&P 500 Members: Median Stock's Drawdown vs SPY
Today's S&P 500 members, read against SPY (493 of 503 have a full year of prices; list as of 2026-10-07). On 2026-10-07 the median one was 15.7% below its 52-week high and SPY was 0.2% below its 52-week high; 38% of them sat more than 20% below their own highs.
Nasdaq-100 Members: Median Stock's Drawdown vs QQQ
Today's Nasdaq-100 members, read against QQQ (98 of 100 have a full year of prices; list as of 2026-10-07). On 2026-10-07 the median one was 17.3% below its 52-week high and QQQ was 0.3% below its 52-week high; 46% of them sat more than 20% below their own highs.
All Nasdaq-Listed Stocks: Median Stock's Drawdown vs QQQ
Every eligible common stock listed on Nasdaq, 2,477 on 2026-10-07. Most are small companies, so this line shows the stocks beneath the Nasdaq-100. QQQ stands in for the Nasdaq Composite, which we hold no price series for: the Composite is weighted by market value and led by the same largest companies, so the two fall and recover together. On 2026-10-07 the median one was 32.8% below its 52-week high and QQQ was 0.3% below its 52-week high; 66% of them sat more than 20% below their own highs.
Survivorship caveat. The S&P 500 and Nasdaq-100 lines use today's members all the way back to 2010-12-30; we hold no historical membership. Companies removed from either index, often after falling, are missing, and later additions are counted before they joined. Older readings therefore look shallower than they were, which makes today's reading look more unusual against them than it is. All four lines also count only stocks that still trade today. Read them for the split between universes at a point in time. The regimes and the forward study on this page use RSP and SPY, which carry no survivorship bias.
Performance: the average stock vs the index
S&P 500 Equal Weight (RSP): Performance vs SPY
Total-price performance of the two, rebased to 100. When the cap-weighted S&P (slate) pulls above the equal-weight average stock (orange), the index's gains are concentrated in its largest names — the hallmark of a narrow market. Uses the investable equal-weight S&P 500 (RSP), which is survivorship-free, so the comparison is honest (an in-house equal-weight of the full universe would be inflated by survivorship).
What the S&P 500 did next — by regime, since 2010
Hidden Bear readings have been above the all-regime baseline
Six months after past Hidden Bear days, SPY averaged +9.6% versus +6.2% across all regimes. It was positive 93% of the time versus 80% overall. The 3.4-point return difference is historical context and makes no forecast.
| Regime | Days (n) | SPY +1m | SPY +3m | SPY +6m | +6m win% |
|---|---|---|---|---|---|
| Broad | 366 | +0.1% | +1.1% | +3.6% | 65% |
| Hidden Bear(today) | 454 | +1.5% | +4.1% | +9.6% | 93% |
| Washout | 72 | +8.5% | +15.3% | +22.8% | 100% |
| Mixed | 2948 | +0.9% | +2.9% | +5.6% | 79% |
Forward returns use SPY closes ~21 / 63 / 126 trading days after every day classified into each regime since 2010. Read as regime context, because a trigger built on it would fire backwards — counterintuitively the beaten-down states (Washout, then Hidden Bear, where the average stock is lagging) preceded the strongest forward returns as the broad market mean-reverted, while Broad participation — already strong — was the most muted. Daily observations overlap, so they are not independent, and the Washout regime rests on very few episodes. RSP and SPY carry no survivorship bias.
How Hidden Bear Index Works
- 1Take the "average stock" as the equal-weight S&P 500 (RSP)We use the investable equal-weight S&P 500 (the RSP ETF) as the average stock — every member counts the same, so it reflects the typical large-cap name rather than the mega-caps that dominate the cap-weighted index. RSP is a real, survivorship-free index that makes new highs and falls into genuine drawdowns (an in-house equal-weight of the full universe would be inflated by survivorship, so we avoid it for performance).
- 2Measure both drawdowns from their own 52-week highsWe take RSP's drawdown from its trailing-252-day high and the S&P 500's (SPY) from its own. Both are real series that touch 0% at new highs and deepen in selloffs, so they are directly comparable. A rebased performance overlay shows their return divergence over the window.
- 3Compare them — the "hidden bear" gapThe gap is the average stock's drawdown minus the S&P's. A large negative gap means the average stock is far worse off than the headline index — the index is being carried by a shrinking set of leaders while the broad market corrects quietly. A positive gap means broad participation: the average stock is keeping up with or ahead of the index.
- 4Read the regime, the dispersion, and what came nextA fixed rule on the two drawdowns labels the market Hidden Bear (RSP at least 2 points further below its high than SPY, with SPY less than 10% down), Washout (RSP 20% or more down and SPY 10% or more), Broad (RSP at least 1 point ahead of SPY) or Mixed. We also surface the full-universe dispersion — the median individual stock's distance from its own 52-week high and the share of stocks 10/20/30% below theirs — and what the S&P 500 did over the following 1, 3 and 6 months from each regime since 2010.