Our team enjoys Autumn and how September can feel like “New Years”. We avail ourselves to the perceived fresh start, and the changing season re-energizes us. We are not the only ones who feel this way, but, good outcomes aren’t always associated with September. In September, trading volumes have historically increased by an average of 13% from the summer months, as “Wall Street gets back to work after Labour Day”. The heightened activity, leads to more volatility.

This has been one of the causes of what has been dubbed the “September Effect”. This refers to the historical significance of it being the worst month for the stock markets.

Several investment research resources whose opinions we value and respect, validated this with commentary over the past week.

September is the only month to average a negative return since 1925, and over the past 10 years, 9 Septembers saw a drawdown of the S&P of at least -5%.

This year, September has started out with weakness; no challenge to the theory yet! We also have the added uncertainty of the upcoming US presidential election, and interest rate changes.

Periods of short-term uncertainty such as these captivate investors, clouding judgement on long-term financial goals. It is important to understand these influences over portfolio returns, however, we maintain that this should not come in the way of “patience” and “time”. With confidence, experience and a long-term strategy, investors should look beyond anticipated weakness and increased volatility, focusing instead on long-term goals and objectives.

Fasten your seat belts and look to the horizon! We will survive September!

Source for data:

https://www.investopedia.com/stocks-september-effect-economy-presidential-election-inflation-fed-2024-8705709

https://markets.businessinsider.com/news/stocks/stock-market-outlook-september-season-fed-cuts-election-investing-2024-8