Sell in May, return another day. The truth.

No doubt everyone has heard a variation of the phrase:

“Sell in May, return another day.”

In Wikipedia it is written:

“Sell in May and go away is an investment strategy for stocks based on a theory (sometimes known as the Halloween indicator) that the period from November to April inclusive has significantly stronger stock market growth on average than the other months. In such strategies, stock holdings are sold or minimised at about the start of May and the proceeds held in cash”

If we are to take this at face value then we should be unwinding out long positions until the Autumn.

What does the chart say?

On the above monthly chart of the S&P 500 each vertical line marks the month of May going back to 2012. That is a dataset of 12.

The facts:

1) The following month, June onwards, 10 from 12 periods returned positive price action of not less than 10%. Selling in May was a bad choice.

2) 2015 and 2022 saw corrections of 15% from May onwards. However in both examples the correction was erased within 12 months as the index continued the uptrend.


In summary, 83% of the time a minimum return of 10% was seen before the year end. Amazing odds.

Furthermore, corrections up and until the end of May (like we’re now seeing) represented some of the best long opportunities. Will say elsewhere what level this is.

Sell in May go away? I suggest it should be:

Buy in June and watch boom!

Ww