Opinion: The best six months for stocks is about to begin

Market Watch ^ | Oct 23, 2015 | Mark Hulbert

[expat_panama]

 

Halloween likely to bring investors treats this year

 

CHAPEL HILL, N.C. (MarketWatch) — Odds are that the Halloween Indicator will be especially good for the stock market this year.

That’s encouraging news, since the Halloween Indicator already carries decent odds of success. But when the stock market is riding a wave of momentum into Halloween — as it most definitely is this year, including another 200+ point rally in the Dow Jones Industrial Average DJIA, +1.87%  on Thursday — then the odds become even better.

The Halloween Indicator refers to the stock market’s seasonal tendency to produce its best returns between Halloween and May Day (the so-called “winter” months). This indicator is also known as “Sell in May and Go Away,” since those who mechanically follow it go to cash during the “summer” months (from May Day until the subsequent Halloween).

Notice from the chart above that the Indicator worked like a charm over the last year. Over the seasonally-favorable six-month period that began on Halloween 2014, the Dow gained 2.6% — versus a loss of 2.6% in the unfavorable summer months that began last May Day.

[Buckeye McFrog]

translation: Gotta rake it in while Obama is still POTUS and the Fed is afraid of being called RAAAAAACIST if they shut off the printing presses.

[citizen]

yeehaw!! We’re all rich!!! (today)

[aimhigh]

Stocks also do well in an election year. However our lame duck president will still be doing everything he can to destroy the economy.

[kjam22]

Yet, the history of the stock market is that it goes up over time. That is not deniable. Until we decide that something so catastrophic has happened so that the stock market will NEVER be higher than it is now or at some given point..... Until that event happens.... the long term outlook has to be that the market will be higher at some point in the future than it is now. That is the way it works. Now that point in time could be months or years from now, and a person has to decide if they are a long term investor, or if they may need the money soon. Or.... if that catastrophic even has happened and the market will NEVER be higher than it is now.

Personally, I view people who say that the catastrophic event has happened and the stock market has reached its all time high for past and future.... I place that viewpoint in the same category as people telling us the world was going to end last sept 23. The end of the world doomsday crowd. And if they're right.... it isn't gonna matter anyway what a person does.

[minnesota_bound]

I wished I had bought Amazon (AMZN) at the beginning of the year... $287 to $602

[Nervous Tick]

>> Yet, the history of the stock market is that it goes up over time. That is not deniable.

Agree, and I think it’s because over the long haul, companies that create wealth — arguably, most of them that end up on the major exchanges — hang around for a long time, and those that are “smoke and mirrors” vanish fairly quickly.

[abb]

Warren Buffett: “Indeed, who has ever benefited during the past 238 years by betting against America?”

Whatever one may think about Buffett’s politics, his investing savvy is undeniable. He knows how to pick winners.

[kjam22]

I agree.... the amateur among us... (including me) who puts a ton of money in single stocks (especially small companies) betting on that big return over a long time....is often rolling dice.... because few of us really know how stable an individual business is and is gonna be over time.

But a conservative approach is index funds, mutual funds holding large caps etc. Something that closer tracks the overall market.

[Texas resident]

Bingo on that one.