Sell in May and Go Away? Why the Old Investing Adage Doesn't Hold Up in 2026
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Both the S&P 500 and Nasdaq closed out April with their strongest monthly performances since 2020. Whether that momentum carries through May is yet to be seen.
Historically, May has kicked off a six-month season of lackluster returns in the U.S., reinforcing a centuries-old investing adage: “Sell in May and go away.”
“The idea suggests investors should step away from equities during the summer months and re-enter the market in November, when conditions have historically been more favorable,” Adam Turnquist, chief technical strategist at LPL Financial, wrote in a research note Thursday.
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But these days, that strategy doesn’t hold much relevance — even if the markets do mellow out over the summer. Turnquist analyzed market trends between May and October dating back to 1950. Indeed, he found that the six-month period historically produced the weakest returns for the S&P 500, averaging just 2.1% gains.
More recently, however, gains between May and October have notably picked up. Over the past 12 years, Turnquist said, the average return has been 5.1%.
“Seasonal patterns can offer useful historical perspective, but they aren’t always a reliable guide for what lies ahead,” he wrote.
“Sell in May” might be particularly poor advice this year. Given the market volatility due to the ongoing Iran war, historical returns become even less helpful.
Lately, oil supply through the Iranian-controlled Strait of Hormuz has largely driven markets — not seasonality. Rising stock prices suggest that investors are confident a peace deal between the U.S. and Iran will ultimately be reached.
Meanwhile, at home, major firms like Apple, Roku and Moderna are reporting better-than-expected first-quarter performance and making waves in part due to anticipated tariff refunds from the Trump administration.
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These developments alone diminish the importance of selling this specific May in particular.
But the logistical tax concerns of selling when the market is at or near an all-time high shouldn’t be ignored either. Selling in a taxable account could spark capital gains taxes, for instance, which would erode returns even if you re-entered the market later this year at a comparable price, according to Hook Wealth Management.
A separate analysis published last month by Eric Wenz, an associate portfolio manager at American Century Investments, underscored the importance of holding instead of selling despite dips.
Wenz illustrated the performance of $1,000 invested in the S&P from 1976 to 2025, pitting “sell in May” against simply buying and holding. After nearly 50 years of growth, the “sell in May” investment jumped to just over $46,000 for an increase of 4,535%.
Meanwhile, the buy-and-hold strategy saw the investment value skyrocket to nearly $295,000 — an increase of 29,179%.
“Long-term portfolios that adhered to a buy-and-hold strategy consistently outperformed those that exited in May,” Wenz said, “proving that sticking with investments through all seasons yielded better results.”