A Statistical Take On The Fourth Quarter

We just completed a simple study for those market bulls who might find themselves temporarily lacking in confidence (assuming such an animal isn’t extinct by now). We found that when the market is making new highs during what has statistically been its worst month, more upside is usually in store for the fourth quarter. Since 1928, there have been 29 times (prior to 2017) that the S&P 500 made a 12-month high in the month of September; in 24 of those cases, the market continued to rise during the fourth quarter. Overall, for all periods (including the five down quarters) following a September high, the market gained 3.7% on average.