Market Seasonality

You know we talk about market seasonality quite a bit.  We last posted on this here.  Looks like others are beginning to get on this bandwagon.  Here's a post from Ryan Detrick who ran some numbers and came up with the conclusions listed in the chart below.  He took each six month period back to 1950 via the calendar year and ranked them best to worst.  Best was November-April.  Worst was May-October.  You know we don't exactly break it down this way and our thoughts on why markets usually run bullish at the end of the year have more to do with Wall Street wanting to bet paid.  However, his conclusions are similar to ours.  You can follow the rest of his thoughts at the link here.  

One thing we need to think about is whether this phenomena is becoming so well recognized that just like the "January Effect"-the traditional period of stock out-perfomance at the beginning of the year that seems to have gone somewhat by the wayside recently-it to will be discounted earlier each year.  Bob-Pisani over at CNBC touched on this a bit earlier this week and it's something that bears watching going forward.  Probability though suggests that as long as we are seeing positive economic growth  there is at the minimum support for stocks, especially on downdrafts into year's end.  We of course dot know what will happen.  That's why we prefer to let our indicators be our guide.

*Long ETFs related to the S&P 500 in both client and personal accounts although these positions can change at any time.