Navigating the Seasonal Stock Market Slumps: Why Seth Golden Says "Buck Up, Campers"

Infotrading.io - The infamous adage "sell in May and go away" has garnered a smug rival — the Seasonal Stock Market Slumps of August and September. If you find yourself reaching for the panic button, let's pump the brakes a tad and consider Seth Golden's audacious claim that the bumpy road we've been on isn't all bad news.

Why put weight behind Golden's wisdom? Let's not forget that he called the S&P 500 hitting 4,350 this year back in February. He dismissed recession fears and sent investors on a shopping spree for large growth stocks like Amazon and Visa — choices that have delivered so far.

Based on the Stock Trader's Almanac, August and September have historically been unkind to S&P 500 investors. For the past 35 years, these months have delivered some of the market's worst performances. This information is far from a revelation, yet it never ceases to raise eyebrows and generate soul-searching among investors.

In light of this, Carson Investment Research's Ryan Detrick found some enthralling data. After a five-month winning streak for the S&P 500 since 1950, 79% of the time, that positive streak extended to a sixth month. While this might not be the case right now, it's vital to remember, as Golden emphasizes, that after five months of gains, the S&P 500’s forward performances six and 12 months later is on average up 82% and 93% of the time, respectively.

"All but one of these former bear-to-bull markets lasted longer and delivered more gains than the current 9-month cycle," says Golden. "It would be very improbable that a new bear market has started at the 9-month mark and doesn't deliver more gains in the 12-month forward period."

So, what's the take-home message here? It’s this: when the Seasonal Stock Market Slumps come calling, it might just be the market's not-so-subtle way of saying, "Hey, I'm taking a short nap, but I'll be back — stronger!"

Remember, market trends are like a rollercoaster. If you scream at every dip and twist, you're missing out on the thrill of the ride. The market isn't just numbers and percentages; it's a living, breathing entity with its moods and quirks. So, when the market gives you Seasonal Stock Market Slumps, make lemonade. Or better yet, consider it a stock market "Black Friday" — a good time to shop for those shares you’ve had your eye on.

So, buck up campers! There may be bumps along the way, but if history and Seth Golden are any indication, a journey through these Seasonal Stock Market Slumps could lead to some rewarding destinations.