Financial Planning Fridays #145: Sell in May & Go Away
The old market saying 'sell in May and go away' has some historical basis, since 1993 returns have tended to be weaker from May through October than from November through April. This video compares hypothetical returns for each half of the year against staying invested year-round, and explains why long-term ownership has historically outperformed either seasonal approach.
The old market saying 'sell in May and go away' has some historical basis, since 1993 returns have tended to be weaker from May through October than from November through April. This video compares hypothetical returns for each half of the year against staying invested year-round, and explains why long-term ownership has historically outperformed either seasonal approach.
Key takeaways
- Since 1993, S&P 500 returns have historically been weaker from May through October than from November through April.
- A hypothetical $100 invested only from May through October would have grown to $271, versus $831 for the November-through-April months, based on this data.
- Staying invested for the full year since 1993 would have grown that same $100 to more than $2,200, outperforming either seasonal half.
- Despite historically weaker summer returns, staying fully invested year-round is presented as the more effective long-term approach, though past performance does not guarantee future results.
Hi friends, as we head into summer 2025, I wanted to take a closer look at the old market saying, 'sell in May and go away.' This idea actually has some historical basis. Since 1993, stock returns have tended to be weaker between May and October compared to November through April.
To put that in perspective, if you had invested $100 in the S&P 500 only during the May through October months, it would have grown to $271. But if you had only invested during November through April, that same $100 would be worth over $831, more than three times as much. However, and of course, the most powerful outcome came from staying invested year-round: a $100 investment held continuously for the entire year since 1993 would now be worth over $2,200.
So, what can we learn from this? While the summer months have had historically modest returns, the best results have always come from staying fully invested for the long term. At Presilium, we believe long-term ownership with a disciplined investment strategy is still the most effective way to grow your wealth and reach your goals. Thank you for watching, and I look forward to talking with you again next Friday morning.
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