October: Worst Month in Election Years
October can invoke fear into investors as it is usually a weak month. However, October often marks the lows for the year. Stay diligent!
Scary September Seasonality
Portfolio managers returning to work after Labor Day tend to clean house. Since 1950, September is the worst performing month of the year. A bullish election-year does little to improve on September’s poor overall performance.
S&P 500 has declined 9 of the last twelve years on the first trading day. Options Expiration week (Triple Witching for September) is usually bullish, but beware after that!
Election Year Shows August Strength
As we discussed at the end of July, the August rally in US small cap stocks has taken hold. Can this continue as major indexes close in on all time record levels?
August Seasonality: Best Month for Tech and Small Caps?
The month of August is usually one of the worst months of the year for US stocks. In years of a US presidential election (like 2020), August holds a special spot in the calendar for certain stocks.
July Seasonality: Mid Month Update
NASDAQ’s mid-year rally (described here in late June) came to an end on July 14. From mid-July, the second quarter is usually plagued with poor performance. Enthusiam and large amounts of cash on the sidelines could keep stock prices aflot. Hower, defensive positioning seems a more reasonable bet.
July Seasonality
July historically is the best performing month of the third quarter. This strength inevitability stirs talk of a “summer rally”, but we must beware of the hype, as summer has historically been the weakest rally of all seasons. Are US election years any different?
Seasonal Strategy: June Usually Ends NASDAQ’s Run
The month of June ranks near the bottom of all months for most of the US indexes. Expect volatility during the third week. After that it tends to only get worse.
Seasonal Strategy Update: Tactical Switch
The best six months of the year for certain US stock indexes has ended. A defensive stance is warranted as the summer months arrive.
May Seasonality: Weak in Election Years
The US stock market in May used to perform buch better than it has in recent years. Still, there is generally a bullish bias in certain stock sectors.
May trading during US election years is generally weak. Caution is warranted, especially in the second half of the month.
Seasonal Trade Strategy: MACD Update
So far, April has regained some of this years losses – in fact the NASDAQ is again positive for 2020.
What should investors do now that markets are entering the weakest period of the year? How bad could this year be, actually?