Geopolitical Shocks · static refresh

Soviet Union Collapse — December 25, 1991

End of the Cold War and removal of existential risk

The Soviet Union formally dissolved on December 25, 1991, ending 46 years of Cold War. The removal of nuclear existential risk was decisively bullish. The S&P 500 returned +26.3% in 1991 and continued into 1992 with a +7.6% total return as the post-Cold-War peace dividend reshaped capital flows.

ALAN INTELLIGENCE

ALAN INTELLIGENCE · alanglobalintelligence.com

ALAN IntelligenceComputed 2026-11-11

Bars: the S&P 500 forward return after the single occurrence. One event, so there is no percentile range.

Based on a single historical event, so there is no spread to show: this is one outcome, not a distribution. Last triggered: 1991-12-25.

Past performance is not indicative of future results. This material is for informational and educational purposes only and does not constitute investment advice, an offer to buy or sell any security, or a recommendation. Data from publicly available sources believed to be reliable but not guaranteed. All investments involve risk, including possible loss of principal.

alanglobalintelligence.com

ALAN GLOBAL INTELLIGENCE · alanglobalintelligence.comSource: S&P 500 daily closes · Computed 2026-11-11

Historical occurrencesshowing 1 of 1

Date	1M return	1Y return	5Y return
1991-12-26	+2.5%	+8.4%	+80.7%

What history says

Editorial commentary written by ALAN analysts. Figures cited below are analyst-authored context — they are not derived from the chart above and may reflect different windows or sources.

Removal of existential risk was unambiguously bullish

The collapse eliminated the single largest tail risk of the post-WWII era. Markets re-priced the entire equity risk premium downward, lifting valuations for the decade that followed.

Capital reallocation fueled a decade-long US bull market

Defense spending fell from 5.2% of GDP in 1990 to 3.0% by 2000. The peace dividend freed capital for technology investment, directly enabling the 1990s productivity boom.

Geopolitical regime shifts differ from geopolitical shocks

Unlike wars and crises (which create uncertainty), the Soviet collapse REMOVED uncertainty. Distinguish between events that add unknowns and events that resolve them.

For your portfolio

Not every geopolitical surprise is a risk event — some remove risk, and markets treated the Soviet collapse as a durable re-rating rather than a shock to fade. When an event resolves uncertainty instead of creating it, consider that de-risking into the news has historically meant selling into an improving regime.

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For information and research only. Not investment advice. ALAN does not place trades or execute orders. Figures come from the sources shown and can lag the market; verify independently before making decisions. Past performance is not predictive of future results.

Date

1M return

1Y return

5Y return

1991-12-26

+2.5%

+8.4%

+80.7%