Market Seasonality.

We've often talked about market seasonality. Today let's flesh out a few of pieces of that data. According to Bespoke Investments** when one takes a look at the Dow Jones Industrial Average (which we'll use here because its the oldest index), December has the most positive returns of any month over the past 50 and 100 years. Over the last 100 years the Dow has averaged a 1.32% return in December. Over the past 50 years it has averaged a return of 1.52% and over the past 20 years it has averaged 1.74%.

Over the past 100 years the Dow has done better when it has been up the preceeding 11 months. In those years it has been up 1.74%. In years when the Dow has been up more than 10% going into this month it has gained around 1.85% in December.

*Long ETFs related to the Dow Jones Industrial Averages in client accounts.
**Bespoke Investments B.I.G. Tips. 11.30.09