Seasonality is not a crystal ball, but it is a consistent analytical framework that helps investors anticipate the market’s rhythm across the calendar year. A recent study by CMT analyst Cory Mitchell, published on TradeThatSwing, reveals month-by-month performance data for the S&P 500, Nasdaq 100, and NYSE Composite, analyzing both 20-year and 10-year trends. The results highlight stable strength in some months, clear pitfalls in others, and evolving patterns that smart investors should internalize.

January: A Lost Indicator

January used to be considered the barometer for the full year. But over the past 20 years, that theory has eroded. The NYSE Composite has consistently underperformed in January, while the S&P 500 has shown lukewarm results at best. Only the Nasdaq 100 has occasionally delivered positive returns in January—but even there, the performance has softened in the past decade.

Bottom line: early-year optimism does not necessarily translate into strong full-year returns.

February to April: The Seasonal Upswing

From February through April, the market shows consistent strength—especially in the S&P 500 and Nasdaq 100. March, in particular, stands out with strong and reliable performance, while April is statistically among the best-performing months across all three indices.

To illustrate: April posted positive returns in 85% of the last 20 years for the S&P 500. In the Nasdaq, both March and April consistently rank among the top five months for returns. The spring rally is often fueled by solid earnings reports and broad investor optimism.

May: Debunking the “Sell in May” Myth

The old adage “Sell in May and go away” no longer holds. In fact, May has shown stable and even strong returns in the last decade. In the S&P 500, for example, May delivered an average return of +1.6% over the past 10 years.

Rather than a time to exit, May now functions as a transitional month, where the bullish momentum of spring continues. It’s a relatively safe entry point for longer-term investors, especially as summer volatility looms.

June: Proceed with Caution

Among all calendar months, June stands out as one of the weakest. The S&P 500 experienced negative returns in approximately 60% of Junes over the past 20 years. The Nasdaq 100 shows a similar pattern, with June consistently ranking among the bottom three months.

June’s underperformance is often attributed to low trading volume, institutional rebalancing, and a lack of macroeconomic catalysts. For short-term investors, it is a month that demands caution, hedging, or reduced exposure.

July: Summer’s Bright Spot

July is the clear winner among summer months. Across all indices, July has proven to be one of the most consistently positive months. In the Nasdaq 100, July posted gains in more than 75% of years over the past two decades.

This strength is typically attributed to the start of Q2 earnings season, positive forward guidance, and institutional repositioning. July often marks a pivot toward more aggressive positioning in tech and growth sectors.

August–September: The Seasonal Trap

August and especially September are considered the market’s most dangerous months. September ranks as the worst-performing month historically across all three major indices. In the S&P 500, September posted losses in approximately 70% of years over the last 20 years. The Nasdaq 100 follows the same trend, with consistently poor results.

August is slightly more forgiving, but still weak relative to the rest of the year. These months often coincide with lower liquidity, geopolitical uncertainty, and limited earnings data, all of which contribute to elevated volatility.

October–December: The Year-End Rebound

October tends to be a transitional month, occasionally volatile, yet also a launching pad for Q4 rallies. But November and December stand out as two of the strongest months. In a 20-year analysis, November ranks among the top five months in every index. In the Nasdaq 100, for instance, November posted positive returns in over 80% of years.

Interestingly, December’s strength has waned slightly over the past 10 years, particularly in tech-heavy indices. This decline is potentially linked to year-end tax-loss harvesting or increased portfolio de-risking by institutional players.

Strategic Implications: Use Seasonality, Don’t Worship It

Seasonality is not a replacement for macroeconomic analysis, but when used in tandem with fundamentals, it becomes a powerful tool. Recognizing that April, July, and November are statistically strong months allows investors to time entries more efficiently. Similarly, knowing that June, August, and September often underperform enables better capital preservation strategies.

By combining seasonal patterns with broader market indicators—like earnings cycles, monetary policy, and geopolitical events—investors can sharpen their tactical playbook and avoid preventable mistakes.