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Technology Stocks : Cisco Systems, Inc. (CSCO)
CSCO 77.02+3.3%Jan 26 3:59 PM EST

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To: RetiredNow who wrote (71011)9/6/2006 2:46:10 PM
From: Mick Mørmøny  Read Replies (2) of 77400
 
Monthly Market Returns - The January Effect, Etc.

Do some months have significantly different market returns than others?

This calculator uses fifty-odd years of S&P 500 data to let you see for yourself. Select a month; the calculator will show you its good and bad years and overall return, for the years from 1950 until recently.

Calculator
moneychimp.com

From the results, it looks like some months really are significantly better than average. November through January is a particularly strong stretch; and September is the "danger" month, with an overall negative return. Surprisingly, October shows positive returns on average, although October 1987 is pretty hard to forget.

Note that December has been better than January, which contradicts two popular myths: the December Selloff, and the January Effect.

But also notice that there are lots of exceptions to the pattern. There have been bad Januaries, and great Septembers. And of course the biggest trend of all is that the market goes up over time. So maybe the lesson here is the usual one, that long-term buy and hold is the winning strategy.

moneychimp.com
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