This is actually an article about stock cycles. If you want to find out about motorcycles go to my good friend, Kickstands, blog for the Nobody Motorcycle Club.
Stocks always cycle up and down and i am trying to remind myself to sell a third or so in positions that have gone up for a while and if they are hitting the top of the channel they are in. There is the annual hockey season cycle that is now coming to an end. For the past 50 years or so if you were fully invested during hockey season you have done much better than if you were only investing during the summer. Another name for this is seasonality. Folks are just too lazy to trade in the summer. Gold stocks usually follow this same "Hockey Cycle".
Here is another cycle website that is worth reading. There is a 30 page free PDF file that explains the Kondratieff wave or cycle. He also talks about the Federal Reserve. The US debt and the sinking dollar are things to be aware of when investing.
My favorite newsletter that covers many markets: stocks, bonds, commodities, currencies for the world is The Aden Forecast. It is worth the small amount it costs per year to stay informed plus get picks that go up.
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Here is part of an article i copied from Mauldin today about poor gains in the summer.
Sell In May and Go Away
Numerous studies show that since World War II, as much as 99% of stock market returns have been generated between November 1 and May 1. Good friend and fishing buddy David Kotok of Cumberland Advisors sums it up nicely:
"According to the Ned Davis (NDR) database, starting in 1950, $10,000 invested in the S&P 500 Index every May 1st and then liquidated every October 31st would only be worth $10,026 today. That's right: had you stayed out of the stock market from November through April and only been in the market from May through October, you would have had no change during the last 57 years. 21 of those years would have been negative; 36 were positive. This happened during the same period that stock prices were rising about 75% of the time and markets made extended upward moves.
Consider the results of the reverse strategy. Buy the S&P 500 Index on November 1st and sell all your stocks on May 1st. The outcome is dramatically different. Your original $10,000 would now be worth $372,890 as of April 30th closing prices in 2008. Out of the 58 periods you would have had positive results in 45 of them and negative results in only 13 years."
David goes on to show research at www.cumber.com as to why he thinks you should hold off on selling. I disagree, but then the stock market has been confirming David's position. My thought is that the Continuing Crisis will put pressure on corporate earnings throughout the summer, with more earnings disappointments at the end of this quarter.
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