Which Month Is Historically the Weakest in the Stock Market?
Seasonal trends in the financial markets are many, and the stock market is no exception. Some months are better than others. What is the weakest month in the stock market?
The weakest month in the stock market is September. The second weakest month is June.
To find the weakest month, we backtested the S&P 500 back to 1960. The results are found in the table further below in the article:
What is the weakest month in the stock market?
We ranked the performance of all months since 1960. This is how we did it:
We buy at the close of the last month and we sell at the close of the current month.
The results for all months look like this:
The first column shows the result for each month.
Clearly, September is the weakest month in the stock market with an average negative return of 0.74%. June is the second weakest month – also negative with 0.15%.
Code for the weakest month in the stock market
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FAQ:
What are seasonal trends in the financial markets?
Seasonal trends refer to recurring patterns in the financial markets that occur during specific times of the year. These trends can impact various assets, including stocks. Some months are historically stronger or weaker than others in the stock market.
What is the weakest month in the stock market, and how is it determined?
The weakest month in the stock market is September, based on backtesting the S&P 500 data since 1960. The second weakest month is June. The determination is made by ranking the performance of all months and analyzing their average returns. September is identified as the weakest month with an average negative return of 0.74%. June is the second weakest month, also experiencing a negative return of 0.15%.
How was the ranking and backtesting conducted for the weakest month?
The ranking and backtesting involved buying at the close of the last month and selling at the close of the current month. The results were then analyzed to determine the average performance of each month. Amibroker was used for the backtesting process. It’s a user-friendly program that allows for backtesting of individual stocks or portfolios. The code used for the backtest can be modified for automated trading.