Outstanding margin debt jumped 77% between April 2025 and June 2026, reaching an all-time high of $1.502 trillion. Since 1997, margin debt has surged at least 65% over a short stretch only four times — and the previous three instances each preceded a sharp market decline. History is more forgiving elsewhere: Bespoke Investment Group data shows the current bull market already ranks among the longest on record.
Outstanding margin debt climbed 77% over a 14-month stretch, from nearly $851 billion to an all-time high of $1.502 trillion, between April 2025 and June 2026. That puts the market in rare territory: margin debt has risen at least 65% over a short period only four times since 1997, and the three earlier instances each came just before a steep slump for stocks.
Three past surges each ended badly
Margin debt jumped 80% to almost $300 billion in the 12 months to March 2000, just before the dot-com bubble burst. Once it did, the S&P 500 lost 49% of its value and the Nasdaq Composite lost 78%.
Debt then rose again. It climbed 66% to roughly $416 billion between June 2006 and July 2007, right before the Great Recession. That crisis erased 57% of the S&P 500's value from peak to trough.
During the pandemic, margin debt soared 95% to $936 billion over 19 months, from March 2020 to October 2021. A nine-month bear market that began in January 2022 then wiped out a third of the Nasdaq's value and a quarter of the S&P 500's.
Stretched valuations add to the picture
The borrowing surge follows the S&P 500's Shiller price-to-earnings ratio reaching 42.84 in early June, the second-priciest reading in data stretching back to January 1871. Leverage's downside surfaced recently, too. Leopold Aschenbrenner's AI-focused hedge fund, Situational Awareness, showed what it can do to a portfolio.
History also favors the bulls
But the pendulum swings both ways. The current bull market, which began on October 12, 2022, is now the ninth-longest in S&P 500 history, according to Bespoke Investment Group. It has already surpassed the 1,324-day bull run that ended on February 9, 1966.
On average, an S&P 500 bear market has lasted 286 calendar days, or about 9.5 months, over the last 97 years. Only nine of 27 bear markets have reached the one-year mark of 365 days, and none has topped 630 days.
The typical bull market tells a different story. It has run 1,023 calendar days through the end of May 2026 — roughly 3.6 times longer than the average bear market. 10 bull markets have lasted at least 1,324 days, and 14 of all bull markets on record have outlasted the longest bear market.
Source: The Motley Fool
Trading involves risk.
Risk Disclaimer
