One of the more persistent investment myths is that it is a winning strategy to sell stocks in May and then wait to buy back into the market around November. The oft-repeated catch phrase is, “Sell in May and go away.”
Well, this year if you sold your stocks in May, you would probably have lost out on some nice gains. The S&P 500 rose from 1883.68 to 1923.57 last month, an increase of 2.1 percent. And that doesn’t include the impact of any dividends.
Of course, the real test of the sell in May theory requires five more months. I ran some numbers looking at returns from May through October in recent years.
Read the rest of the article on CBS Money Watch.