We warned you last month that September, not October, is statistically the worst-performing month for the stock market. We also told you why this September would be particularly bad. But most importantly, we told you what steps to take to guard your investments.
Well, now that September is fully in the books you can see that our concern was justified.
The Dow Jones Industrial Average fell 5% for the month, far exceeding the average 1.07% loss the index has seen in September since its 1896 launch. The other months have averaged a 0.71% gain.
That 1.87-point spread is considered by mathematicians to be "statistically significant at the 95% confidence level."
But this September had more going against it than a bleak history. With so much detrimental news weighing on investors' minds, from the Greek debt crisis to weak U.S. economic data to concern that the U.S. Federal Reserve has run out of policy options, a September market swoon was inevitable.
Most of the ugliness was confined to a handful of really bad days. The Dow actually rose on 11 of 21 trading days in September, but on the days it fell, it fell hard. Six of the down days recorded drops in excess of 200 points.
But as bad as this September market swoon was, however, it was no surprise to readers of Money Morning or its new sister service, Private Briefing.
In the Sept.1 Private Briefing report "Investment Plays for the Current Economy," Executive Editor Bill Patalon not only warned readers of what was to come, his interview with Money Morning Global Investment Strategist Martin Hutchinson laid out a "safety-first" investing strategy to help readers protect their portfolios.
Although September is over, many of the negatives that have caused the market swoon in recent weeks haven't changed. And the craziness isn't going to stop any time soon.
"Despite the fact that the VIX (Chicago Board Options Exchange Market Volatility Index) has come down substantially from the reading of 48 we saw in August, it's still pricing in 3% to 4% moves per day through November," said Money Morning Chief Investment Strategist Keith Fitz-Gerald. "That's worth a gut-wrenching 340 to 454 Dow points in both directions."
You don't have to let such looming threats damage your portfolio. Private Briefing subscribers have the advantage of getting investment advice and insights straight from such top market experts as Fitz-Gerald and Hutchinson.
To find out more about Private Briefing please click here for a special report.
News and Related Story Links:
- Money Morning:
Private Briefing Service
- Money Morning:
We Warned You U.S. Stocks Could Plunge – Here's the Safety Play You Need to Make Now
- ETF Trends:
Stock ETFs Stumble Into September with 5% Loss
Looking at a scary September
- Bespoke Investment Group:
About the Author
Dave has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.