In face of the overbuying pressing towards a blow-off top i can see no reason for this well documented adage to be an exception this year. Here the Hirsh stastitics on "Sell in May and go away" <<May ushers in the "weaker six months" period on Wall Street, which stretches interminably through the end of October. The weather gets better, returns get worse -- as the old Wall Street adage goes, "sell in May, then go away."
According to the Hirsch Organization, which publishes the Stock Traders Almanac and first pinpointed the trend in 1986, an investment of $10,000 in the Dow industrials for the months of November through April since 1950 would have resulted in a compounded gain of $457,103 as of the end of 2001.
The same investment made in the months of May through October compounded since 1950 would have resulted in a loss of $77.
Not every year was a stinker during the summer months -- about a third of the time, stocks performed better in the May-October period. But over the long haul, there is a distinct trend of outperformance in the November through April months.>> GD
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