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Sell in May?

An old adage says investors should “Sell In May And Go Away.” The historical analysis suggests summer months of the market tend to be the weakest of the year. The mathematical statistics prove this, as $10,000 invested in the market from November to April vastly outperformed the amount invested from May through October. Interestingly, the max drawdowns are significantly larger during the “Sell In May” periods. Previous important dates of major market declines occurred in October 1929, 1987, and 2008. However, not every summer works out poorly.

Historically, there are many periods where “Sell In May” did not work and markets rose. 2020 and 2021 were examples where massive Federal Reserve interventions pushed prices higher in April and subsequent summer months. However, 2022 was the opposite, as April declined sharply.

So, let's see what the market will give us this year.

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