Don’t Buy the “Sell in May” Lie

Daily Profit Investing Research
by 

“Sell in May and Go Away.”

It’s one of the most loved sayings on Wall Street.

Yet you’ll be leaving a ton of money on the table if you follow this advice.

So, what exactly IS “Sell in May and Go Away”?

This adage suggests that investors should SELL stocks in May and sit in cash through October. And then re-invest in stocks from November through April.

Let’s take a look at the S&P 500 performance from 1928 – 2023.

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It’s easy to see that from November through April annualized returns are 12.9%.

That’s pretty good compared with the 6.4% annualized return from May through October.

However…

A 6.4% annualized is still a very healthy positive return.

So, why on earth would you want to sit on the sidelines in cash during this time?

The average 6-month CD is currently paying just 1.6%.

Here’s the takeaway…

Long-term investors should simply own stocks or ETFs for the long-term. There’s no point selling in May – especially when you can expect a healthy and positive return in the market.

Ian

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