Summer Has Come and Passed: A Seasonal Story, Not a Crisis

Every year around this time, headlines light up about market pullbacks in September. Investors get anxious, portfolios dip, and the question always comes up: “Is something wrong?”

The truth is: no. September weakness in the stock market is one of the most consistent seasonal patterns in investing — and it’s been happening for decades. Let’s look at the data.

Seasonality in the Market

Looking at S&P 500 returns over time, clear trends emerge:

• Past 10 years: September has averaged –1.9%, the weakest month of the year.

• Past 20 years: Still negative at –0.6%.

• Since 1957: Consistently soft, averaging –0.9%.

Meanwhile, the strongest months are usually late in the year. November and December have historically delivered some of the best returns.

In other words, September has a long track record of being choppy — but it’s part of the cycle.

Why Does This Happen?

There’s no single answer, but a few factors tend to align:

• Seasonal psychology: After summer, investors reset portfolios and take profits.

• Fiscal calendars: Funds rebalance before year-end reporting.

• Election cycles: In post-election years, September has been especially weak.

None of these signals a broken market — it’s more about timing and behavior.

What Happens After September

Here’s the important part: historically, markets don’t stay down.

• October through December is typically much stronger, with November often leading the way.

• Long-term investors who stay the course usually benefit from catching the recovery instead of sitting out.

This is why professional investors don’t panic in September. They understand the bigger picture.

Seasonality reminds us of a key truth: short-term pullbacks are normal, not alarming. September tends to be red, but history shows the market has a strong tendency to recover into year-end.

If you’re investing for long-term goals — retirement, financial independence, family security — the dips are just part of the journey. In fact, they can create opportunities.

So, if you see headlines about September struggles, remember: it’s not a crisis—it’s just the calendar.

Process over predictions.

Shean