Welcome to September the loveliest time of year - except in the markets
By Dian Vujovich
September is my birth month so naturally I think it’s the greatest month of them all. Wall Street history, however, sees it differently.
Before looking at what the ninth month of the year usually brings investors, a quick recap of the S&Ps performances over the previous eight months of this year shows plenty of positives.
For instance, year-to-date as August 2013 ended, the S&P 500 had gained 14.5 percent; the S&P 500 Growth Index was up 13.71 percent; its Value Index ahead 15.35 percent; the S&P Mid-Cap 400 up 16.02 percent; and S&P Small-Cap 600 up 20.20 percent.
If I were a short-term investor who looked only at what returns a year could give me, and was playing any of the aforementioned S&P Index games, I’d be tempted to sell my positions, take all my marbles off the table and be quite satisfied with the double-digit returns of the year.
There would be nothing wrong with doing that, you know, although you’d hear plenty of negative yelps and jeers from investment advisors. Plus, following through with the sale executions would be difficult. As an aside, one of the reasons investors don’t make as much money as they could in the stock market —or any other one for that matter– is because selling out of positions is so much more difficult than buying into them.
Back to September.
According to The Stock Trader’s Almanac, September has been the worse month of the year for the past 60 years with the S&P500 losing on average one-half of one percent during this month of the calendar year.
With concerns about Syria and the U.S. reaction to that country’s use of chemical warfare on its citizens, who knows what actions lie ahead or what any kind of action, or non-action, could mean to us and our markets. Salt any of those possible wounds with Fed-related economic stuff and that idea of taking all your marbles off the table might not be such a dumb idea.
Then again, what do I know? I’m only a woman, with a birthday looming large right in front of her who has learned that double-digit returns don’t come along every year. And like age, are to be respected.
To read more articles, please visit the column archive.