September Effect in Election Years: Will This September Close Up or Down?

MillionaireTiger
09-12

Welcome to Thursday Special![LOL]

We often hear about the so-called "September Effect" in the stock market. Looking back at the past five years, it seems to hold some truth, but if you widen the scope to over 10 years, the trend isn’t as clear.

Below is the historical performance of the S&P 500 in September over the past decade.

But what about this year? It’s an election year in the U.S., and elections have been known to impact the market.

Here’s something interesting:

Since the S&P 500 Index began, there have been 23 election years. Out of those, 19 times (83%) the market delivered positive returns.

Here’s the breakdown:

  • When a Democrat was in office and another Democrat took over, the market’s average annual return was 11%.

  • When a Democrat was replaced by a Republican, the average annual return was even higher at 12.9%.

So, with this in mind, and the S&P's typical September performance, do you think the election year effect can save this September’s market?

Will this September close up or down? 1%? 3%? 5%?

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Comments

  • nomadic_m
    09-17
    nomadic_m
    The 'September Effect' refers to the historical trend of stock markets declining in Sep, especially in US election years, due to uncertainty surrounding election outcomes. Since 1928, the S&P 500 has averaged a -0.7% return in Sep of election years. However, the market often experiences a post-election rally as clarity on policy and leadership emerges, and past performance doesn't guarantee future results.

    As an avid investor, I remain hopeful. I believe this period of volatility presents an attractive opportunity to add positions in fundamentally strong companies with solid financials, competitive advantages, and long-term growth potential. By doing so, investors can capitalize on temporary dips and set themselves up for potential long-term gains.

    $iShares 20+ Year Treasury Bond ETF(TLT)$
    $SPDR S&P 500 ETF Trust(SPY)$
    $Invesco QQQ Trust-ETF(QQQ)$
    $iShares Russell 2000 ETF(IWM)$
    $SPDR Portfolio S&P 500 Growth ETF(SPYG)$

  • Shyon
    09-12
    Shyon
    The "election year effect" refers to the historical trend where markets tend to perform well during election years, often due to increased investor optimism and anticipated government stability. However, whether it can "save" this September's market depends on a range of factors, including current economic conditions, political developments, and investor sentiment.

    If the broader economic and geopolitical landscape is challenging, the election year effect alone may not be sufficient to reverse or mitigate downturns. It's important to consider the overall economic context and market fundamentals alongside historical trends.

    For me, will it be Trump or Harris, both of them will sure try to boost the market when they get elected, as their first gift to investors.

    How do you think? @MillionaireTiger @TigerStars @TigerEvents @TigerGPT @Tiger_comments

    • ShyonReplyBarcode: 
      Cheers 🥂
    • BarcodeReplyShyon: 
      Cheers for the 🏷️ Shyon 🧡🩵
    • TigerGPT: 

      Based on the recent news and historical data, here's an analysis of the September effect in election years and its potential impact on the market:

      Stock market performance in September: September has historically been a challenging month for the stock market, with increased volatility and potential downturns. However, the performance can vary depending on the specific year and prevailing economic conditions.

        

      Election year effect: In election years, the market has shown a tendency to perform better than in non-election years. Out of the 23 election years since the inception of the S&P 500, 19 times (83%) the market delivered positive returns. Moreover, when a Democrat was replaced by a Republican, the average annual return was even higher at 12.9%.

        

      Factors influencing September's market performance: The market performance in September depends on various factors, including current economic conditions, political developments, and investor sentiment. Recent events such as the August jobs report and the potential rate cut by the Federal Reserve can impact market expectations and performance.

        

      Market sentiment and challenges: September is historically associated with a sense of risk aversion and heightened market volatility. Factors like the 9/11 attacks and the subprime mortgage crisis have contributed to negative sentiment. However, in election years, the average decline in September has been smaller compared to non-election years.

        

      Outlook and insights: While September may present historical challenges, there are unique factors at play this year, including the potential rate cut and the dynamics of an election year. The Federal Reserve is expected to announce a rate cut, and historical data suggest that September during a presidential election year tends to be less negative for the stock market than in non-election years.

        

      Considering the above information, it is difficult to predict with certainty whether September's market will close up or down, and by what percentage. The market's performance will depend on a combination of factors, and it is always important to consider the overall economic context, market fundamentals, and geopolitical landscape.

      Risk disclaimer: The information provided is for reference purposes only and does not constitute investment advice. Investing in the stock market involves risks, including the potential loss of principal. It is recommended to conduct thorough research and consult with a professional financial advisor before making any investment decisions.

    • Shyon: 
      Come and join guys @koolgal @rL @icycrystal @b1uesky @Universe宇宙 @Barcode @nomadic_m @GoodLife99 @Fenger1188
  • icycrystal
    09-12
    icycrystal
    however the market swings is anyone's guess. better not be too aggressive since election may affect.how the market flows...

    @Shyon @GoodLife99 @Universe宇宙 @rL @HelenJanet @Aqa @LMSunshine @koolgal @SPACE ROCKET @TigerGPT

    Will this September close up or down? 1%? 3%? 5%?

    🎁Prizes

    Comment Rewards:

    All valid comments on the following post will receive Tiger Coins

    • TigerGPT: 

      根据目前的股票筛选结果和相关报道，以下是一些影响9月份股市的因素：

      大选不确定性：由于大选结果的不确定性，投资者可能对市场的走势感到担忧。根据一些分析师的观点，随着大选日期的临近，投资者可能选择减少股票风险敞口，这可能导致市场的下跌。

        

      历史表现：据报道，9月底通常是标普500指数表现最差的时间段之一。此外，根据历史数据，科技股在这个时期也可能经历一定的回调。

        

      风险投资基金的动向：一些分析师指出，全球活跃投资者，尤其是对冲基金，在大选临近时可能调整其股票敞口，这可能加剧市场的波动性。

        

      需要注意的是，股市的走势受到多种因素的影响，包括经济数据、公司业绩、全球贸易等等。因此，不能完全依赖以上因素来预测9月份股市的走势。

      请注意，以上内容仅供参考，不构成投资建议。股市投资具有风险，投资者应该根据自己的风险承受能力和投资目标做出决策。根据近期的新闻报道和分析文章，以下是一些与九月份股市表现相关的要点：

      新加坡股市（海峡新加坡指数）在9月12日开盘时上涨了0.42%。新加坡股市星期四开盘升0.42%

        

      美股在辩论结束后表现不一，三大指数涨跌互现。特斯拉涨幅为4.58%。美股复盘+辩论结束后

        

      9月份是美股成为“开门黑”的一个月，表现通常较弱。历史数据显示，标普500指数在9月份的平均回报率为-0.56%，道琼斯工业平均指数在9月份的平均回报率为-0.96%。美股遭遇9月“开门黑”！三大指数重挫，芯片股成“重灾区”

        

      根据现有信息，九月份股市的走势依然难以预测。特别是在即将到来的总统大选期间，市场可能受到不确定性因素的影响。因此，投资者可能不宜过于激进。为了更准确地预测股市走势，建议综合考虑其他因素，例如相关公司的业绩表现、宏观经济状况和市场情绪等。

      请注意，以上观点仅供参考，不构成投资建议。投资涉及风险，投资者应自行决策，并根据自己的投资目标和风险承受能力做出相应的调整。

  • Aqa
    09-13
    Aqa
    September is perceived as the worst month for Investing because when the fall season begins and the vacationing investors return to work, they exit positions they had been planning on selling. When this occurs, the market experiences increased selling pressure and, thus, an overall decline. The stock markets are doing relatively well these few days but there is a lot of volatility so anything can happen. It is prudent to do due diligence before each trade. Good luck! 🍀 Thanks @MillionaireTiger @icycrystal
  • SPACE ROCKET
    09-13
    SPACE ROCKET
    I feel the market will close up instead of down.

    There are more and more news circulating about how the debate between Trump and Kamala was skewed unfairly in Kamala's favour.

    She did surprisingly better than expected (compared to past debates and public speeches) and that's because she had questions released to her beforehand. She was even assured of not being fact checked and that only Trump would be. The female moderator also turns out to be her sorority sister 🤦‍♀️

    I believe stocks will fly across the board when Trump comes into office.

  • MHh
    09-13
    MHh
    This September is special because we might be finally seeing the first rate cut after years of high interest rates. I think this can have bigger effect on boosting the market than the election. I think a rise of 2% is manageable and not too overly positive.
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