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The Best and Worst Months for the S&P 500 Index (1926 – 2006)

By JLP | September 5, 2007

From 1926 – 2006, only ONE month has averaged a negative return for the S&P 500 Index*. Can you guess what month that was?

September

That’s right, only September has averaged a negative monthly return every year since 1926. Another way to look at it: had you invested your money during the month of September every year since 1926, you would have had an average monthly return of -.76%!

The best month?

The best month for the S&P 500 Index historically has been July with an average monthly return of 1.86%.

Here’s a complete list ranked by month:

The Best and Worst Months for the S&P 500 Index

Now here’s a look at each month:

The Best and Worst Months for the S&P 500 Index

It’s interesting to note that although the month of December had the greatest number of up months, it’s average performance still lagged the month July.

Finally, for those who are interested, here’s a look at the year in which the best and worst months occured:

The Best and Worst Months for the S&P 500 Index

Notice that most of them occured in the 1930s – evidence of just how volatile the 1930s were (that and it was also probably due to the fact that the index traded for a lot less than it does now, which made each point worth a greater percentage).

One last bit of trivia for you:

From 1926 – 2006, there were 972 months. Of those 972 months, 605 (62%) of them were up months and 367 (38%) were down months.

*From 1926- March 3, 1957, the S&P consisted of 90 stocks. It was expanded to 500 stocks on March 4, 1957.

Source: Appendix B of The Only Three Questions That Count (Affiliate Link) by Ken Fisher and this spreadsheet download from StandardandPoors.com. I entered the data and performed the calculations on my own.

Topics: Index Funds, Investing | 10 Comments »


10 Responses to “The Best and Worst Months for the S&P 500 Index (1926 – 2006)”

  1. Aaron Says:
    September 5th, 2007 at 11:35 pm

    Interesting information. October through December has a very strong pattern of being up months. It is interesting that although September has an overall negative return on average, there is still one more up month than down. September has obviously been a month where there have been some severe selloffs which serve to skew the average to some degree.

  2. The Dividend Guy Says:
    September 6th, 2007 at 8:16 pm

    What I read from this information is that it is really worthless to try to time the market. Over this long period of time, there have been more up months than down (even in September). In the end over the long term an investor will stay ahead if they follow a consistent approach that balances risk.

    Jeremy

  3. Free Money Finance Says:
    September 7th, 2007 at 5:19 am

    Star Money Articles for the Week of September 3

    Here are some recent interesting posts from the MoneyBlogNetwork and beyond: Blueprint for Financial Prosperity asks why airlines can overbook flights. Consumerism Commentary has had a lunch conversion. AllFinancialMatters details the highs and lows of…

  4. Weekly Blog Roundup, Dr. Zoidberg Edition on Consumerism Commentary: A Personal Finance Blog Says:
    September 7th, 2007 at 12:21 pm

    […] AllFinancialMatters presents the best and worst months for the S&P 500. Jim from Blueprint for Financial Prosperity has abandoned AT&T Wireless. Mighty Bargain Hunter found some good items at last week’s yard sale. […]

  5. » Weekly Roundup: I Want A Toyota Hybrid on Blueprint for Financial Prosperity Says:
    September 8th, 2007 at 1:30 pm

    […] JLP shares with us the best and worst months for the S&P. […]

  6. BNET1 » S&P 500: Best & Worst Months on Average on BNET Says:
    September 10th, 2007 at 9:16 am

    […] The question is: Which months have the best and worst chances of a positive return? Well, to get that answer, AllFinancialMatters did some number crunching of Standard & Poors’ data. They found that September is the bleakest of the twelve, while July seems to be the most hunky-dory on average. […]

  7. September is a Bad Month For Stocks—� AllFinancialMatters Says:
    October 1st, 2007 at 12:37 am

    […] After putting yesterday’s The Best and Worst Months for the S&P 500 Index (1926 – 2007) post together, I decided to take a closer look at the month of September. Here’s what I found out. […]

  8. The Best and Worst Months for the S&P 500 Index (1926 - 2007)—� AllFinancialMatters Says:
    January 9th, 2008 at 12:13 am

    […] This is an updated version of the post I did last summer. […]

  9. Nick Says:
    November 14th, 2011 at 12:24 pm

    Going back to 1926 skews the data. The investment world from 1926 through 1940 was very different from the post war investment world. 18 of the 24 (3/4 of the total) best and worst months were from 1926 to 1940. These years were more volatile than later years. If you stick with the later years after WW II, then the six months from November thru April do much better than the months from May thru October. And, there are more Septembers with a loss than a gain, the only month for which this is true.

  10. JLP Says:
    November 14th, 2011 at 2:08 pm

    Thanks for your comment, Nick. I’ve done stuff in the past where I didn’t go all the way back to the beginning of the data and people basically accused me of data mining. I have done posts like this in the past and I think I mentioned the clustering of the data in the 20s and 30s. I guess I should not that in this post too.

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