Stock market crashes: How does China's stack up?

Chinese stock market's free fall continues
Chinese stock market's free fall continues

The crash tearing apart China's stock market is freaking out investors around the world.

The country's biggest stock market has melted down 32% in a matter of weeks, wiping out more than $3 trillion of wealth. The mayhem is infecting other markets, driving down equities in Asia, metals like copper and even U.S. stocks.

"China is a complete madhouse. For onshore investors, the world is coming close to ending," analysts at Bespoke Investment Group wrote in a note to clients Wednesday.

Well that's certainly scary. But it's helpful to put China's crash in context with other recent market meltdowns.

Related: China stocks hammered as market crash continues

China vs. America's financial crisis: So far, it's nowhere near as bad as the slow-motion crash that crushed the American stock market at the end of the last decade. The S&P 500 took a 58% nosedive between October 2007 and March 2009 when it bottomed at the ominous level of 666.

Yet China's crash is somewhat comparable to one of the scariest moments of the financial crisis. The S&P 500 plunged as much as 41% in the two months after the catastrophic bankruptcy of Lehman Brothers in mid-September 2008. That's not much worse than China's summer plunge.

At times during the recent crash, the Shanghai Composite has plummeted nearly 10% on an intraday basis. U.S. investors aren't completely foreign to that kind of move. During the May 2010 Flash Crash, the S&P 500 mysteriously declined nearly 9% -- much of that free fall in mere minutes -- before rebounding. At one point, Procter & Gamble (PG), one of the world's largest companies, plummeted 37% by itself.

Related: China fears crash into gold, copper

China vs. U.S. dot-com crash: Much focus has been paid to collapse of China's version of the Nasdaq. The Shenzen Stock Exchange is down 40% since mid-June as investors flee small-cap and riskier tech stocks.

"Market participants have begun to fear that the Chinese equity bubble may have now burst," Ankur Patel, chief investment officer at R-Squared Macro Management, wrote in a note to clients on Wednesday.

Those fears are backed up by the fact that the Shenzen's tumble is eerily similar to the pain inflicted on American investors just after the dot-com bubble popped. After peaking in March 2010, the Nasdaq crumbled nearly 41% in just 10 weeks. Just like how China's market could keep collapsing, the Nasdaq ultimately lost a whopping 78% of its value before bottoming in October 2002.

Related: China is taking 10 huge actions to save its stock market

China vs. 'Black Monday': China has yet to experience the frightening crash that hit U.S. markets in October 1987. Dubbed "Black Monday," the Dow lost an unbelievable 22.6% of its value that day.

During the Great Depression, 86% of the value of the U.S. stock market was wiped out. It took investors who got in the day of the peak a whopping 25 years to recover.

Emerging market crashes are common: In many ways, the ongoing crash in China looks like a scarier and speedier version of recent emerging market meltdowns.

For example, Argentina's stock market plunged 40% between October and December of last year. (It's making a big comeback effort this year though.) A currency crisis helped erase 32% of Turkey's stock market during the middle of 2013 as well.

R-Squared compiled the following list of similar declines that have recently knocked other emerging markets:

Brazil: 20% (June to July 2013)
Russia: 18% (February to June 2013)
Chile: 22% (March to September 2013)
Poland: 26% (June to September 2011)
Russia: 31% (May to October 2011)
Taiwan: 22% (June to December 2011)
South Korea: 25% (May to September 2011)
Chile: 25% (June to October 2011)

Of course, China's market has already eclipsed these declines in a shorter timeframe. And there's a huge difference between a crash in tiny Chile and one in China, which is now the world's second-largest stock market.

"China's size makes this drawdown particularly impactful and concerning," said R-Squared's Patel.

CNNMoney Sponsors