Jun

4

May Away, from anonymous

June 4, 2013 |

"Sell in May. Go away" -Wall Street lore

"Rough winds do shake the darling buds of May" - Sonnet 18, Shakespeare

Like many of the Wall Street adages, there is always a bit of truth along with some misdirection. Looking recently since 1998 (n) buying at the end of May, the next four months are -10,-6,-12, -9 SP points on average, roughly 50% of these months are down with a few large negative moves. So the summer months are negative on average but not impressive on the downside. Also, if the holding period is a modest 12 months the effect becomes very muted compared to the profits of buying after most of the other months, shown in average SP points. (jan)15, (feb)18, (mar)14,(apr)15,(may)-5, (jun)-2,(jul)1, (aug)11, (sep)14, (oct)8, (nov)-4, (dec)-2

Maybe the advice should be "buy pretty much after any month if you can hold a year or more". But that is hard to rhyme.


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