The Beginning Of May And The Market

Now that it is May some investors are reminded of the adage, "sell in May and go away." Selling in May in 2009 certainly would have left investors on the sidelines during one of the strongest bull markets of recent years.

The tough part with the selling in May strategy this time around is where does an investor go with the cash. As the above table shows, even the low rates of return in the May to October period would be better than money market investments in this market. As a recent Bloomberg BusinessWeek article notes, the May to October period has seen gains in 12 of the last 20 years. The Sell in May and Go Where? article provides an investor with some areas of the market that have tended to perform well during this period, i. e., Health Care and Staples are a couple of sectors.

Source:

Stocks: Sell in May?
Bloomberg BusinessWeek
April 27, 2010
http://www.businessweek.com/investing/insights/blog/archives/2010/04/stocks_sell_in_may.html

Sell in May and Go Where?
The Outlook
By: Sam Stovall
May 5, 2010
http://www.spoutlookonline.com/NASApp/NetAdvantage/mkt/OutlookMarketInsight.do?subtype=OWMO&pc=NET&tracking=NET&context=Company&docId=15400443