summertime blues

[Ombud]

Thought I'd do something different this year and follow the 'sell in May & go away' strategy. But September turned out worse. For those who like to play with stats; how often does that turn out to be accurate?

[ModE98]

The market takes some strange turns...maybe 60/40 odds.

[clarkrl2]

From 1950 to 2011 for the month of September the S&P 500 has lost an average of -0.74%. There were 27 up years and 35 down years for September during that interval. www.moneychimp.com/features/monthly_returns.htm

[The Virginian]

And now for the rest of the story : ;D

From the results, it looks like some months really are significantly better than average. November through January is a particularly strong stretch; and September is the "danger" month, with an overall negative return. Surprisingly, October shows positive returns on average, although October 1987 is pretty hard to forget.

Note that December has been better than January, which contradicts two popular myths: the December Selloff, and the January Effect.

But also notice that there are lots of exceptions to the pattern. There have been bad Januaries, and great Septembers. And of course the biggest trend of all is that the market goes up over time. So maybe the lesson here is the usual one, that long-term buy and hold is the winning strategy.

[Ombud]

Heard that, Virginian.

[ModE98]

Thought this article might really give us Summertime Blues ... egad, life is going to change unless the useless politicians get together, get to work, and compromise on the real problems before it becomes too late. The stats tell a grim tale (a picture is worth a thousand words sometimes).

seekingalpha.com/article/901871-the-3-scariest-government-charts