Spring really begins in March, but for investment portfolios, April has been a month that has added some sunshine to investors’ monthly statements.
Bespoke Investment Group notes that over the last fifty years the month of April has the best average monthly return for the Dow Jones Industrial Average (DOW)—2.21%. Additionally, the month ends positively about 68% of the time, which is in the top three out of all months in the year. Most recently, April has been the best month for this commonly referenced index in a calendar year over the last twenty years, as it has ended positive 85% of the time and had the highest average monthly gain.1
That’s the data, for the DOW anyway.
Now for some real talk, all the above violates the cardinal compliance disclosure of financial advisors: past performance is no guarantee of future results. Financial advisors memorize that line, and every investor should too. Yet with all the negative news out there like inflation, rising rates, and geopolitical conflict—what those who speak market cliché like to call “headwinds”—I thought some positive data might brighten your Monday.
All this to say, seasonality can be a helpful indicator, but many successful investors are the kind that invest in season and out of season because the market likes to prove even the best wrong and can be unpredictable.
Remember successful investing isn’t a sprint, it’s a marathon.
Rain or shine.
1. The source for the figures referenced in this paragraph is taken from the following tweet on April 1, 2022: https://twitter.com/bespokeinvest/status/1509871973794566208