'Sell In May And Go Away' Looks Outdated As May–July Data Signal Bullish S&P 500 Seasonality
Investors clinging to the old market adage "Sell in May and go away" risk missing reliable gains. Recent historical trends from May 1 to July 31 show the S&P 500 often rallies during this period, challenging decades-old seasonal wisdom.
April, typically one of the strongest months for U.S. equities along with November and December, is set to end in negative territory this year as Trump-related tariff announcements rattled markets.
"History would argue that if the S&P 500 is able to pull off this feat and April losses or gains turn out to be relatively mild… the outlook isn't quite as grim," Jeff Buchbinder, chief equity strategist at LPL Financial, said in an email.
In such scenarios, the S&P 500 — as tracked by the SPDR S&P 500 ETF Trust (NYSE:SPY) — has posted an average return of 5.9% from May through December and 11.5% for the full year.
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What Happens Between May And July?
Contrary to the adage, May through July has increasingly been a period of strength for stocks.
According to Seasonax data, during this three-month window, the S&P 500 gained ground in 11 of the past 15 years. The average return across those years is 3.3%, while the median is 4.3%.
The standout year was 2020, when the index surged 14% in the aftermath of the pandemic rally. On the downside, 2010 saw the S&P 500 fall 8.4% during the same period, its worst May–July stretch in the dataset.
Recent years paint an even clearer picture: over the past decade, the index rose in 9 out of 10 May–July periods, with an average gain of 5.3% and a median of 4.6%. That's hardly consistent with a market hibernation phase.
What About 2025—A Post-Election Year?
Market behavior in post-election years tends to reinforce the bullish May–July trend.
Based on 97 years of data, the S&P 500 recorded gains in 18 out of 24 such periods following a U.S. presidential election. The average return during those months is 3.8%, with a median return close to 3%.
This suggests that political cycles may influence investor confidence and liquidity, creating favorable conditions for equities between May and July.
Was The ‘Sell In May’ Rule Ever Valid?
Between 1962 and 2012, the “sell in May” strategy held more weight. Over those 50 years, the S&P 500 delivered gains in just over half of the May–July periods (26 out of 50), yet with an average return of negative 0.3%.
The worst performance came in 2002, when the index cratered 16.9% amid the collapse of tech stocks.
S&P 500 Performance Between May 1 To July 31
Period
Positive Years
Negative Years
Average Return
Median Return
Worst Return
Best Return
Last 15 Years
11
4
3.3%
4.3%
-8.4% (2010)
+14.0% (2020)
Last 10 Years
9
1
5.3%
4.6%
-0.8% (2022)
+14.0% (2020)
Post-Election Years (24)
18
6
3.8%
2.9%
-13.1% (1969)
+19.2% (1997)
1962–2012 (50-Year Span)
26
24
-0.3%
0.4%
-16.9% (2002)
+19.2% (1997)
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