Sell in May, Go Away

A strategy that leads to pay day? Not really.

Ian Tam, CFA 30 April, 2021 | 1:45AM
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Of the market timing strategies known to investors, “Sell in May, Go Away” is often mentioned, not only because of its catchy rhyme but perhaps also because of its appealing nature. Wouldn’t it be nice to go up North for the Summer and not worry about your investments? To its credit, the strategy was founded on some logic: during the Summer months as investors are less active, trading volumes fall, as does enthusiasm for the market and hence potential for gains. There is also a bit of truth to the concept if you look at the historical returns in Canada.

Exhibit 1

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About Author

Ian Tam, CFA  is Director of Investment Research at Morningstar Canada. 

 

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