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.