A great way to go about investing is to focus on the long term and invest in companies that seem likely to be much bigger in a decade or more.

Many of us like to keep things simple and invest in one or more low-fee, broad-market index funds, such as the Vanguard S&P 500 ETF (VOO -0.23%). So will that fund do? Well, here's some bad news and some good news.

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First, the bad: No one knows! The stock market is simply dynamic, and occasionally quite volatile. It could drop sharply tomorrow and stay down for years.

Here's the good news: Despite falling every few years, and despite wars, business scandals, financial crises, recessions, and more, the stock market -- including the S&P 500 -- has always eventually recovered, going on to set new high records. Indeed, over many decades, the stock market has averaged annual returns of close to 10%.

A closer look at history can help. Stock researcher Ben Carlson analyzed the rolling average returns for the S&P 500 between 1926 and 2023, saying:

The best 10-year annual return was 21.4% for the period ending toward the tail-end of 1959. That's a total return of roughly 600%. ... The worst 10-year annual return was a loss of almost 5% per year ending in the summer of 1939. That was bad enough for a 10-year total return of -40%. The 1930s were a little rough. The only other time the market experienced negative returns over 10 years was starting with the bursting of the dot-com [bubble] at the start of the 2000s followed by the Great Financial Crisis hitting toward the end of that decade.

Other than these extreme market downturns, every other 10-year period featured an overall gain from the S&P 500.

So take heart. We don't know how the stock market will perform in the short term, but over long periods, it has almost always gone up. Long-term investors will likely do well just investing and hanging on through thick and thin.