For those starting with nothing and wanting to build towards a passive income, now might seem a terrible time to get started. That’s because the markets have been powering higher in the last year or two. Popular indexes like the FTSE 100 and the American S&P 500 were breaking new records this year. Even after a pullback from the Iran conflict, many stocks are close to record highs. Surely we want to buy at a low instead?

For anyone worried that the good times have been and gone, here are a few uplifting statistics:

• The S&P 500 (which is better studied that its British equivalent) breaks its record high an average of 38 times every single year.
• The index ends the month on a high one in every four months.
• Nearly half of all trading days end within 5% of the previous all-time high.

Near highs

So what’s going on here? To summarise: stocks markets tend to usually be at or near record highs. This shouldn’t come as too much of a surprise. For one, the effects of inflation mean that even if everything else remains constant, an index like the FTSE 100 should be slowly creeping upwards as the value of money decreases.

But perhaps more importantly, businesses are designed with growth and efficiency in mind. This is why stocks have made the best investments down the years – even beating housing most of the time, which I imagine comes as a shock to some of us.

A useful phrase to be reminded of here is that ‘time in the market beats timing the market’. What this is getting at is that investors should buy as early as they can and not worry about the day to day swings. The more time spent investing, the better. And that’s why getting started today is better than waiting for a better opportunity.

Not going anywhere

Where to get started? One stock that ticks a lot of the boxes for a newbie investor might be consumer goods giant Apple (LSE: APPL). The company sells popular products that aren’t going anywhere. An investment could be a great starting point to build wealth for a passive income.

It’s worth saying that for many American stocks, the dividends on offer are miserly. Investors here are looking at a dividend yield of 0.39%. The share price will need to rise from growth and share buybacks to make this a good investment. Yet Apple is up 98% in the last five years, so the track record here is good.

As for downsides, there’s an argument that the firm has lost its creative edge. The company that revolutionised consumer electronics with the iPhone and iPad has had a couple of stinkers recently. The recently released Apple Vision Pro – a £3,000 virtual reality headset – has hardly taken the world by storm and there are rumours of the product being wound down.

Like stock markets as a whole, the Apple share price is very close to a record high at the moment. Yet I don’t think that’s any reason to steer clear and I believe this is a stock to consider.