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  • Poterack Capital Advisory

April Showers Bring May Flowers



Do April showers bring May flowers?  If it doesn’t rain in April, do you have to bring your own flowers?  There are many saying that are familiar, yet we may not consider the source or validity. 1-800Flowers says this saying originates from a poem written in 1157.  For most of these sayings, proverbs, and adages, their being truthful depends on a variety of random variables!  Remember, a broken (non-digital) clock is correct twice per day!

 

So, let’s move to May.  Have you heard of the old financial adage; "Sell in May and go away"?  This saying suggests that investors should sell their stock holdings in May to avoid a seasonal decline in the stock market, and then reinvest in the fall. The idea is that the stock market tends to underperform during the summer months, from May to October, compared to the winter months, from November to April.

 

This “strategy” guarantees nothing and isn’t statistically valid from a historical perspective.  However, this doesn’t prevent the adage being mentioned often in financial circles every May.  On May 1, 2024 the S&P 500 closed at 5018.39 and closed May 22nd at 5307.01 (Source: S&P 500 index).  This is a 5.75% increase during the first three weeks of May. 

 

For those of you that didn’t sell in May, you just might have plenty of money to buy all the flowers you want regardless of the weather!  

 

Disclosure:  Index performance does not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. Past performance does not guarantee future results.

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