Halloween and Market Spooks

We’re just a one day away from the spookiest day of the year with Halloween falling this Wednesday. With ghosts, goblins and ghouls running amok, you’d be inclined to think that there is nothing but fear and fright all around on the evening of the 31st. There is, however, one reason to be just a little bit joyous when the clock strikes midnight and the eleventh month of 2018 gets underway, this being that October has come to an end. For a lot of us, the most frightening part of October isn’t the creepy costumes, decorations, or haunted houses, but the fact that October is the worst month for the market in regards to overall average performance.

So is this just a random coincidence, or is there a reason for the consistent downturn during the month? Firstly, the month got its unfortunate reputation as a less than stellar one for investors in 1929, when on October 29 the market collapsed and resulted in our nation’s worst economic recession, now known as the Great Depression. The second reason October has worse stock performance is that it follows September, another historically poor month for the market whose performance could potentially bleed into the following month. Finally, the idea of behavioral finance and investing comes into play heavily in this case. With a lot of investors cognizant of October’s reputation as a poor month for the market, it can cause them to make rash decisions without really thinking, perhaps selling hard on their currently owned assets before the perceived downturn hits, which of course will end up aiding the cause of the downturn they sought to avoid. So, if the thought of vampires and werewolves are making you sleep with the lights on this week, just remember that October will soon be behind us, and with it, hopefully, the start of better market performance in the month of November. I’ve always liked Thanksgiving better anyway.

Share:

Facebook
Twitter
Pinterest
LinkedIn
On Key

Related Posts

Episode 12 – Answering Questions about Social Security

Episode 12 – Answering Questions about Social Security In this episode of Blue Money, Kevin and Jim are discussing all things involved in the social security benefits of being a police officer. They start off by explaining how officers qualify and what “credits” means, in regards to social security. Then they jump into answering the

Episode 11 – Portfolio Review

Episode 11 – Portfolio Review In this episode of Blue Money, Kevin & Jim are doing a mid-year check-in. They are reviewing their portfolios and the market performance so far this year. The guys discuss the US economic climate, touching on cryptocurrency, the stock market, bonds, and commodities. They also talk about global economics, looking

How not to blow up your portfolio and financial plan

We got a call the other day from a Verizon Employee who just retired! They worked for over thirty years, giving the world dial tone. They were disciplined and invested. They experienced numerous bear markets and some of the worst recessions that have taken place since the mother depression of 1929; despite this: the 2022

Episode 10 – What you need to know about Credit Cards

Episode 10 – What you need to know about Credit Cards In this episode of Blue Money, Jim & Kevin are discussing all things credit cards. Jim starts off the conversation with a personal story, like so many others, about his own experience getting in credit card debt at a young age. They go into

Scroll to Top