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SEPTEMBER: THE CRUELEST MONTH

28 August 2010 by Chart of the day 2 Comments

By Chart of the day:

Except for a brief counter-trend rally in July, the stock market has struggled since peaking in late April. Investors are concerned. For some perspective, today’s chart presents the Dow’s average performance for each calendar month since 1950. As today’s chart illustrates, it is not unusual for the stock market to underperform during the May to October time frame with a brief counter-trend rally occurring in July. It is worth noting that the worst calendar month for stock market performance (i.e. September) is fast approaching.

Notes:
- Where’s the Dow headed? The answer may surprise you. Find out right now with the exclusive & Barron’s recommended charts of Chart of the Day Plus.

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Comments
  • Adam Ruchka

    Investing made easy. I’ll just put my money on the sidelines in June and September and everything will be peachy.

    Come on… these charts are misleading. Take out September of 2008 and I bet this month doesn’t look all that bad.

    Charts like this influence future price action more than they reflect it.

    08/28/2010 at 8:12 AM
  • SteveS

    The only problem with all these historical charts
    - housing goes up 5-10% a year for 60 years before 2007
    - stocks averaged 10% gains for 80 years before 2000
    - stock Presidential cycle – 45% annual gains

    Is that as Alice says, we are on the other side of the looking glass, where white is black (swans and presidents) and up is down. If I flip a coin 20 times and get 15 heads, for next flip probability theory says 50% chance of heads, bettors (investors) will say 75% chance of heads, mean reversion says more tails than heads until only 50% heads total.

    08/28/2010 at 11:42 AM