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Sell in May and Go Away?

Posted by Doug Hutchinson | CFA®, Director of Research and Trading

April 24, 2018

With the month of May approaching, it’s the time of year when we’re reminded of the old Wall Street saying, “sell in May and go away.” In theory, this suggests that an investor can sell out of the stock market on May 1st and get back into the market on November 1st to avoid the months where equity returns are typically depressed.

While the saying “sell in May and go away” may be catchy, is it actually sound investment advice?

Over the 50 years prior to 2016, during the 6-month period from May 1st through October 31st, U.S. stocks returned an average of 2.68%, while the 6-month period of November 1st through April 30th, U.S. stocks returned an average of 8.08%.[1]

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