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Sell In May and Go Away?

by Catherine Trinder Miller, May 11, 2017


"Sell In May and Go Away." Should you? Our friends from J.P. Morgan Asset Management take an evidence-based approach to answering this question.

Specifically, their research shows that an investor in a 60/40 stock and bond portfolio using the "sell in May" strategy would have missed out on $255,000 over 25 years compared to an investor who stayed the course. This is strong evidence that an investor who stays disciplined and invested, even through turbulent or slow markets, is rewarded in the long run. The importance of having a diversified portfolio designed to meet your specific goals and needs can't be understated. In periods of market turbulence, which inevitably will arise, having a clear and custom financial plan designed to help achieve both your short and long term goals will inform your choices and best position you to stay the course.1

Chart of the Week: Source: Standard & Poor's, Barclays FactSet, J.P. Morgan Asset Management. 60/40: A balanced portfolio with 60% invested in S&P 500 Index and 40% invested in high quality U.S. fixed income, represented by the Barclays U.S. Aggregate Index. The portfolio is rebalanced annually. 25 year time period is from May 1992 to April 2017.

Notes:
1 Source: Standard & Poor's, Barclays FactSet, J.P. Morgan Asset Management. 60/40: A balanced portfolio with 60% invested in S&P 500 Index and 40% invested in high quality U.S. fixed income, represented by the Barclays U.S. Aggregate Index. The portfolio is rebalanced annually. 25 year time period is from May 1992 to April 2017.

Views expressed are not necessarily those of Raymond James & Associates and are subject to change without notice. Information contained herein was received from sources believed to be reliable, but accuracy is not guaranteed. Information provided is general in nature, and is not a complete statement of all information necessary for making an investment decision. Past performance is not indicative of future results. There is no assurance these trends will continue or that forecasts mentioned will occur. Investing always involves risk and you may incur a profit or loss. No investment strategy can guarantee success.

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