Hello All,
Looking at a few of my positions tonight and trying to decide if I should continue to 1) look at their charts, or 2) really concentrate on the dog barking down the street, or 3) go watch the paint dry on my neighbors house.
Now that got me to thinking about the so called dog days of summer stock movement and what I've heard, but never verified. That is, if you were to use a pure mechanical system of investing 10,000 from November 1st to April 30 of each year, and being out of the market from May 1 to October 31, you'd do just fine. That prompted a little Excel work where I invested 10,000 and let it grow (or not grow) from 1950 to present, using 6 month investment periods.
Here's 10,000 invested in the months of May 1 to Oct 31 only:
DATE CLOSE % TOTAL
5/3/99 11014.69
10/30/98 8592.1 (0.061) 11,221
5/1/98 9147.069
10/31/97 7442.08 0.067 11,946
5/1/97 6976.48
10/31/96 6029.38 0.081 11,198
5/1/96 5575.22
10/31/95 4755.47 0.102 10,355
5/1/95 4316.08
10/31/94 3908.12 0.056 9,398
5/2/94 3701.02
10/29/93 3680.59 0.068 8,900
5/3/93 3446.46
10/30/92 3226.28 (0.033) 8,334
5/1/92 3336.09
10/31/91 3069.1 0.047 8,617
5/1/91 2930.2
10/31/90 2442.33 (0.085) 8,227
5/1/90 2668.92
10/31/89 2645.08 0.095 8,991
5/1/89 2414.94
10/31/88 2148.69 0.052 8,209
5/2/88 2043.27
10/30/87 1993.53 (0.126) 7,806
5/1/87 2280.4
10/31/86 1877.8 0.056 8,929
5/1/86 1777.8
10/31/85 1374.3 0.106 8,454
5/1/85 1242.09
10/31/84 1207.4 0.021 7,640
5/1/84 1183
10/31/83 1225.2 0.017 7,486
5/2/83 1204.3
10/29/82 991.7 0.168 7,358
5/3/82 849
10/30/81 852.5 (0.144) 6,299
5/1/81 995.6
10/31/80 924.5 0.143 7,357
5/1/80 808.8
10/31/79 815.7 (0.047) 6,436
5/1/79 855.5
10/31/78 792.5 (0.061) 6,750
5/1/78 844.3
10/31/77 818.4 (0.121) 7,191
5/2/77 931.2
10/29/76 964.9 (0.026) 8,183
5/3/76 990.3
10/31/75 836 0.006 8,398
5/1/75 830.9
10/31/74 665.5 (0.221) 8,347
5/1/74 853.9
10/31/73 956.6 0.038 10,710
5/1/73 921.2
10/31/72 955.5 0.014 10,313
5/1/72 942.3
10/29/71 839 (0.100) 10,171
5/3/71 932.4
10/30/70 755.6 0.030 11,303
5/1/70 733.6
10/31/69 856 (0.098) 10,974
5/1/69 949.2
10/31/68 952.4 0.043 12,169
5/1/68 913.2
10/31/67 879.7 (0.015) 11,668
5/1/67 892.9
10/31/66 807.1 (0.134) 11,843
5/2/66 931.9
10/29/65 960.8 0.042 13,674
5/3/65 922.1
10/30/64 873.1 0.069 13,124
5/1/64 817.1
10/31/63 755.2 0.049 12,282
5/1/63 719.7
10/31/62 589.79 (0.121) 11,704
5/1/62 671.2
10/31/61 703.9 0.040 13,320
5/1/61 677.1
10/31/60 580.29 (0.032) 12,813
5/2/60 599.6
10/30/59 646.6 0.034 13,239
5/1/59 625.1
10/31/58 543.2 0.189 12,799
5/1/58 457
10/31/57 441 (0.111) 10,768
5/1/57 495.8
10/31/56 479.9 (0.066) 12,106
5/1/56 514
10/31/55 454.9 0.067 12,966
5/2/55 426.3
10/29/54 352.1 0.102 12,151
5/3/54 319.39
10/30/53 275.8 0.000 11,022
5/1/53 275.7
10/31/52 269.2 0.050 11,018
5/1/52 256.39
10/31/51 262.39 0.006 10,494
5/1/51 260.7
10/31/50 225 0.043 10,426
5/1/50 215.8 10,000
Now, here's 10,000 invested in the months of Nov 1 - April 30:
DATE CLOSE % TOTAL
4/30/99 10789.04 0.239 364,154
11/2/98 8706.14
4/30/98 9063.37 0.181 293,852
11/3/97 7674.39
4/30/97 7008.99 0.164 248,818
11/1/96 6021.93
4/30/96 5569.08 0.168 213,778
11/1/95 4766.68
4/28/95 4321.27 0.119 182,976
11/1/94 3863.37
4/29/94 3681.69 (0.003) 163,587
11/1/93 3692.61
4/30/93 3427.55 0.051 164,073
11/2/92 3262.21
4/30/92 3359.12 0.099 156,158
11/1/91 3055.9
4/30/91 2887.87 0.176 142,062
11/1/90 2454.94
4/30/90 2656.76 0.004 120,765
11/1/89 2645.9
4/28/89 2418.8 0.125 120,271
11/1/88 2151
4/29/88 2032.33 0.009 106,955
11/2/87 2014.09
4/30/87 2286.4 0.207 105,995
11/3/86 1894.3
4/30/86 1784 0.283 87,818
11/1/85 1390.3
4/30/85 1258.09 0.034 68,438
11/1/84 1217.09
4/30/84 1170.8 (0.048) 66,208
11/1/83 1229.3
4/29/83 1226.2 0.219 69,516
11/1/82 1005.7
4/30/82 848.4 (0.021) 57,015
11/2/81 866.8
4/30/81 997.8 0.065 58,252
11/3/80 937.2
4/30/80 817.1 (0.004) 54,714
11/1/79 820.1
4/30/79 854.9 0.033 54,915
11/1/78 827.8
4/28/78 837.3 0.038 53,174
11/1/77 806.9
4/29/77 926.9 (0.041) 51,243
11/1/76 966.1
4/30/76 996.9 0.207 53,411
11/3/75 825.7
4/30/75 821.3 0.234 44,238
11/1/74 665.3
4/30/74 836.8 (0.118) 35,836
11/1/73 948.8
4/30/73 921.4 (0.049) 40,632
11/1/72 968.5
4/28/72 954.2 0.155 42,709
11/1/71 825.9
4/30/71 941.8 0.242 36,966
11/2/70 758
4/30/70 736.1 (0.139) 29,752
11/3/69 854.5
4/30/69 950.2 0.002 34,538
11/1/68 948.4
4/30/68 912.2 0.052 34,472
11/1/67 867.1
4/28/67 897.1 0.108 32,768
11/1/66 809.6
4/29/66 933.7 (0.026) 29,572
11/1/65 958.9
4/30/65 922.3 0.053 30,370
11/2/64 875.5
4/30/64 810.8 0.076 28,829
11/1/63 753.7
4/30/63 717.8 0.202 26,799
11/1/62 597.1
4/30/62 665.3 (0.055) 22,292
11/1/61 703.8
4/28/61 678.7 0.160 23,582
11/1/60 585.2
4/29/60 601.7 (0.068) 20,334
11/2/59 645.5
4/30/59 623.79 0.144 21,814
11/3/58 545.2
4/30/58 455.9 0.049 19,065
11/1/57 434.7
4/30/57 494.4 0.014 18,179
11/1/56 487.6
4/30/56 516.1 0.135 17,929
11/1/55 454.9
4/29/55 425.7 0.203 15,803
11/1/54 354
4/30/54 319.3 0.154 13,141
11/2/53 276.7
4/30/53 274.8 0.017 11,388
11/3/52 270.2
4/30/52 257.6 (0.025) 11,197
11/1/51 264.1
4/30/51 259.1 0.148 11,480
11/1/50 225.7 10,000
$11,221 versus $364,154.
I've decided to go watch the paint dry.
Take care,
Eric
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