{"id":3225,"date":"2016-05-10T16:54:16","date_gmt":"2016-05-10T20:54:16","guid":{"rendered":"http:\/\/162.223.13.186\/~zacksim\/should-you-sell-in-may-and-go-away\/"},"modified":"2022-02-26T13:22:18","modified_gmt":"2022-02-26T13:22:18","slug":"should-you-sell-in-may-and-go-away","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/should-you-sell-in-may-and-go-away\/","title":{"rendered":"Should You Sell in May and Go Away?"},"content":{"rendered":"<p><strong><em>New York, New York asks\u2026<\/em><\/strong><\/p>\n<p><strong><em>Mitch, there\u2019s an old investing adage \u201cSell in May and Go Away,\u201d that\u2019s based on notoriously weak summer returns. I think about doing this every year\u2014does it make sense?<\/em><\/strong><\/p>\n<p>The \u201cSell in May\u201d adage makes its way into the equities market narrative every year, so I\u2019m not surprised you\u2019re hearing about it again. Looking at historical statistics, I will concede that there\u2019s a decent<em>, <\/em>but by no means strong<em>, <\/em>argument for ditching stocks for a six-month period starting in May. Since 1928, the S&amp;P 500 has pretty widely outperformed during the November\u2013April period relative to the May\u2013October months, producing a +5.1% average return versus the meager +1.9%.<\/p>\n<p>But the fallacy of the \u201cSell in May\u201d strategy is also apparent as the May\u2013October period <em>is still positive <\/em>on average. Since 1928, the actual month of May has been positive 49 times and negative 39 times, meaning if you took this approach the odds of being correct are already stacked against you.<\/p>\n<p>The last two years prove as much. In 2014, the \u201cSell in May and Go Away\u201d strategy would have crimped portfolio returns since the S&amp;P 500 rose some 7% during the May\u2013November period. Trying the strategy in 2015 would have also been largely ineffective, since it would have meant buying into the S&amp;P 500 at essentially the same level you sold. An investor would have avoided the steep summer correction last year but would have also missed the compelling \u201cv-shaped\u201d bounce off the bottom. There are too many examples of the strategy not working to take it seriously.<\/p>\n<p>The May\u2013October period may not be the strongest six-month period historically, but it\u2019s still positive on average. If there\u2019s any adage you should follow, I\u2019d recommend, \u201c<em>It\u2019s time in the market, not timing the market.<\/em>\u201d<\/p>\n<p style=\"text-align: center;\">\n","protected":false},"excerpt":{"rendered":"<p>New York, New York asks\u2026 Mitch, there\u2019s an old investing adage \u201cSell in May and Go Away,\u201d that\u2019s based on [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":4257,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[66,71],"tags":[],"class_list":["post-3225","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mitchs-mailbox","category-private-client-group"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3225","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=3225"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3225\/revisions"}],"predecessor-version":[{"id":11361,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3225\/revisions\/11361"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=3225"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=3225"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=3225"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}