A Follow-Up To Yesterday.

I thought a follow-up was in order after yesterday's post, particularly regarding the discussion of seasonal volatility. Here is a very crude illustration of the bullish and bearish phases that markets often experience during the investment year. Please treat time periods as approximate. Please note that markets do not always work this way, especially regarding the timing of each phase. Also there are years that some or none of these phases comes into play.

With that being said, here are a few things that have been statistically verified about market seasonality:

1. The period roughly from mid-March to sometime in early October is generally considered a weaker investment period. Stocks tend to experience most of their corrective phases during this time.

2. The inverse of that is that October through some time in the Spring is statistically the best time to be invested in the markets. This will often be negated during structural bear markets.

3. The month of September is statistically the worst trading month of the year.

4. The fourth quarter of each year typically is the best performing investment quarter {All us Wall Streeters want to get paid!}.

*Long ETFs related to the S&P 500 in client accounts.