"Sell in May and Go Away": Does It Work?

The most famous seasonal saying in investing. Here's what the data shows.

The Concept

"Sell in May and go away, come back on St. Leger's Day (September)"

The idea is that stocks historically perform better November-April than May-October.

Historical Performance (S&P 500, 1950-2025)

Past performance does not guarantee future results.

The "Best 6 Months" Pattern

A well-known observation:

• November through April has historically been the stronger 6-month period
• May through October has historically shown weaker returns

Does It Still Work?

Recent decades show:

• Effect weakened but persists
• Summer losses smaller than historical
• Missing Jul-Aug gains is the downside

How Traders Have Approached This

1. Some reduce equity exposure during the historically weaker May-October period
2. Others rotate to defensive sectors like utilities, staples, and bonds
3. Some focus on quality dividend stocks during summer months
4. Many watch for October as a historically favorable re-entry period

Alternative Perspective

Many market participants don't fully exit - they simply shift focus to historically defensive sectors during summer.

This is statistical analysis of historical data, not investment advice. Always do your own research.

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