Sell in May and go away?

[saash]

I thought it was unfounded rumour ....

[platsak]

I had the same thought the other day. Its strange how old sayings tend to get value with experience.

[org]

Depends if the market is already high in May.This time it was.

[SimonPB]

it is still twaddle.

[ketman]

Really? Check out the article by Bouman and Jacobsen on the "Halloween Indicator" downloadable from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=76248. They find that "stock market returns should be higher in the November-April period than those in the May-October period. Surprisingly, we find this inherited wisdom to be true in 36 of the 37 developed and emerging markets studied in our sample. The 'Sell in May' effect tends to be particularly strong in European countries and is robust over time. Sample evidence, for instance, shows that in the UK the effect has been noticeable since 1694."

[john_1]

Y-man posted an article a while back showing historic monthly returns for the JSE worst month was June with 0.3% return best month was Dec and Jan. May is an average month.

[SimonPB]

then why aren't they sailing around the med in their million foot yatch? Yes we can go back in time and back fit all sorts. Question is - how does it make us money? It doesn't. This sell in May, when did you sell? if 30 April, you missed the high by some 3 weeks and are poorer for it.

it is twaddle.

[DST]

Maybe more so than not since 1694, but having been in the markets since well before then I feel obliged to point out the anomalies caused by events like Austerlitz & Waterloo. Recent conflicts have had a more muted contra-seasonality.

[BRE]

Ja, absolute twaddle! You don't sell period; you're stop losses should take care of that, not the calendar.

[louisg]

I think that this should be rephrased: A SPECULATOR should sell in May and go away, an INVESTOR should care less about this and just continue on with their current investment strategy. From a wise long term investor