LPL: A Silver Lining
It’s been a rocky ride so far in October, but there is a silver lining. “Incredibly, the S&P 500 during a midterm year has never finished lower if you bought the October low and held till the end of the year,” explained LPL Senior Market Strategist Ryan Detrick.
Of course, no one can pick a market low with any consistency, but with October about to end, it is safe to assume the low happened last week or will happen over the next few days.
As our LPL Chart of the Day shows, the past 18 midterm years saw the S&P 500 Index gain from the October lowest close until the end of the year every single time—up 10.6% on average. Given the average year since 1950 is up 7.4% on average from the October lows, midterm years can see even more strength to end the year.
For more thoughts on the recent sell-off and what could happen the rest of 2018, be on the lookout for our latest Weekly Market Commentary.
Source: https://lplresearch.com/2018/10/29/a-silver-lining/