What if stocks were tracked like home prices?

Imagine watching the often volatile stock market more like the relative slow-motion tracking of home prices.

Stock price moves are typically digested on a daily – if not minute-to-minute – basis using short-term yardsticks for the ups and downs. As 2022 drew to a close, we could dissect the dismal annual outcome for stocks within seconds of the year’s closing bell.

Yet home prices – a huge slice of many households’ net worths – are tabulated at a far slower pace.

Data collection is lethargic. And that sales data is analyzed by the industry using longer-term metrics – a month of activity or more – and frequently tracked using 12-month “year-over-year” measurements of change. We will wait weeks, if not months, for a final accounting of home prices for 2022.

So as a fun exercise, I filled my trusty spreadsheet with daily closing prices for the broad Wilshire 5000 stock index dating back to 2000. I compared two measurements, both using 12-month change, to simulate housing-like analysis for stocks.

One yardstick was what I’ll call “real-time” – the last trading day of a month vs. a year earlier’s result. The other is the same 12-month math just using a three-month moving average of the Wilshire 5000. This is a rough replica of housing’s widely watched Case-Shiller indexes.

What I learned was that the three-month averages when looking at year-over-year stock results do little to smooth out short-run gyrations. One geeky volatility measure called “standard deviation” shows this moving average with only 6% less volatility than real-time results since 2000.

But what three-month averages with a 12-month focus clearly do is delay seeing big market moves. Just ponder the stock market’s response to the pandemic when measured by these two price prisms.

Crushing blow

Coronavirus cratered the economy in early 2020 as the stock market was coming off a great 2019: a 28% real-time gain – last day of the year vs. 12 months earlier, the best result in six years, and a 14% 12-month gain for my 3-month average, the biggest gain in 14 months.

But the pandemic era’s initial lockdowns crushed stocks. Economic unknowns pushed the real-time results to a 12% year-over-year loss by the end of March 2020. My 3-month average cooled to an 11% gain at the same moment.

In May 2020, with massive economic stimulus packages in place and the economy slowly reopening, the real-time index already was rebounding, up 8% year over year. The 3-month average was still digesting the lockdowns and was off 5% year over year.

By July, both benchmarks were positive – up 5% for the 3-month average year over year as the real-time measure jumped 10% as an unexpectedly strong economic revival was unfolding.

And at the year’s end of 2020, as vaccines were on the way to dampen the pandemic’s health issues, stocks in real-time were up 18% for the year and my 3-month average was up 16%.

More pandemic stimulus helped created a business boom. So outsized stock market gains continued in 2021: up 30% for the year by the 3-month average’s tally and 26% for the real-time measurement.

Then came 2022 and the Federal Reserve’s fears of an overheated economy, asset bubbles and 40-year high inflation. The central bank’s attempt to cool the economy with interest-rate hikes in 2022 was bad news for stocks.

Again, the market response was muted through the moving-average lens. By April 2022, the real-time index was flat year over year but showed an 8% gain for my 3-month average.

It wasn’t until June 2022 that both indexes were losers – down 4% year over year for the 3-month average vs. a 14% drop in real time.

And the year ended badly on both scorecards: an 18% loss for the 3-month average vs. a 21% dip for real time.

Bottom line

The end of a year is a rare time people chat about the stock market’s 12-month performance.

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Stocks trade every business day so it’s a fantasy to see any shift away from that market’s short-term thinking. If nothing else, need-to-know-now is human nature.

But my fellow stockholders, some long-term perspectives will be required to grapple with the ugly year-end investment statements coming to the mailbox.

Compared with stocks, it feels like we’re hopelessly behind when it comes to tracking home prices.

It’ll be late January for the first of many year-end home price reports. And it’ll be late February before the final 2022 Case-Shiller numbers – that three-month price average.

These delays are especially troublesome when housing’s status is so muddied as 2023 begins.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at

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