What will it take for a 2025 outperformer to defy the mean reversion in 2026?
The year just gone by saw a rapid rotation as the winners from 2024 often slipped, and laggards staged a comeback. Will we see another flip in 2026? Will last year’s outperformers become this year’s laggards or vice versa?While past performance is no guarantee of future results, a cycle of mean reversion shows that even rotation is selective, driven by valuations and fundamentals.Also read: Pulse of the Street: Markets glide into 2026 as metals, autos lead the chargeMomentum was hard to sustain among the blue-chip stocks. Nearly six in every ten stocks delivered weaker returns in 2025 compared with 2024.
In fact, around 33% of the large-caps that had gained in 2024 slipped into losses in 2025. In contrast, only 20% of stocks that declined in 2024 managed to bounce back and gain in 2025.Consistency was also hard to find. Only 15.8% of large-cap stocks delivered gains in 2024 and 2025.
Looking over a longer stretch, just 14% managed to post gains in three straight years in 2023, 2024 and 2025—showing how difficult it has been for these stocks to stay firmly in green for long. This churn was visible even earlier. Over 68% of large-cap stocks fell in 2024 compared with 2023.
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