A Good Start Tends to Mean a Good Year

91%, eh?  Those are odds you can work with….Here are some general market thoughts via Credit Suisse on what happens when the year gets off to a good start.  Unfortunately, this doesn’t leave much upside even if the odds are high:

“Since 1970, 90% of the time the January to February period has seen markets rise by 6% or more (as has been the case in 2013), equities have risen for the rest of the year on average by c11%.

The only exception to this was in 1987 – but even in that case equities managed to rise 18% between the end of February and the middle of August (before falling 20% during Black Monday). Yet, in spite of that correction, markets still were up on the year overall.”

Source: Credit Suisse


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Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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  1. Weird chart, it’s missing 1996-2012.

    And it also appears to show that if Jan-Feb is up, get out since the full year gain is only .4% higher than Jan-Feb.

  2. Two strategists who were pessimistic last year have turned bullish thru year-end 2013. They are calling for SPX to exceed 1600, even 1625 by year-end. Goldman Sachs Group Inc. (GS)’s chief U.S. equity strategist, David Kostin, raised his target today for the benchmark stocks gauge by 3.2 percent to 1,625 from 1,575. Adam Parker of Morgan Stanley (MS) boosted his 2013 estimate by 12 percent to 1,600 from 1,434. They join strategists at Deutsche Bank AG, Credit Suisse Group AG (CSGN) and Jefferies Group LLC in increasing their targets for U.S stocks in the last week.

  3. Eleven data points are not enough to make statistically valid conclusions, as to the strong Jan-Feb data. Count me as a skeptic on this. Before 2013 is over, it is likely that we will have at least one 10% + correction. The year may still end higher than it started, but we won’t get there without going through a rough patch somewhere.