Here it comes, the scary month of October. Many investors have bad memories of this month, mainly because it has had some spectacular crashes. In particular, 1929, 1987, and 2008 are a few of the years that saw October scar investors for a long, long time.
Here’s some good news: Over the past 20 years, the S&P 500 Index has shown a higher average return in October than in any other month. And the good news continues. This is a midterm year and, sure enough, midterm years have actually been quite strong for stocks. “Incredibly, since 1982, the scary month of October has seen stocks fall only once during a midterm year. Not to mention it has been the best month overall going clear back to 1950 for all midterm years,” explained Senior Market Strategist Ryan Detrick.
As our LPL Chart of the Day shows, October has been up 3.3% on average during a midterm year, ranking it as the best-performing month–ahead of the usually bullish months of November and December.
For more of our thoughts on the upcoming quarter and the quarter that was, be sure to read our latest Weekly Market Commentarydue out later today.
*Please note: The modern design of the S&P 500 stock index was first launched in 1957. Performance back to 1950 incorporates the performance of predecessor index, the S&P 90.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. The economic forecasts set forth in this material may not develop as predicted.
All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. All performance referenced is historical and is no guarantee of future results.
Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.
This research material has been prepared by LPL Financial LLC.
To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL Financial LLC is not an affiliate of and makes no representation with respect to such entity.
The investment products sold through LPL Financial are not insured deposits and are not FDIC/NCUA insured. These products are not Bank/Credit Union obligations and are not endorsed, recommended or guaranteed by any Bank/Credit Union or any government agency. The value of the investment may fluctuate, the return on the investment is not guaranteed, and loss of principal is possible.
For Public Use — Tracking # 1- 776504 (Exp. 10/19)