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Ask Matt: is fall a bad time for stocks?


Q: Is the fall a horrible time for stocks?

A: Fall kicks off today. And that's a good thing for investors.

The primary fall months of October, November and December have been some of the best months for investors to be in the market. All three of these months have delivered average monthly gains for investors going back to 1950, says Stock Trader's Almanac based on the Standard & Poor's 500. December has been the best month on record delivering average annual gains of 1.7% during the month and November is tied with April as the second best at 1.5%.

Some investors might fear recent history hasn't been as kind as these longer-term statistics might indicate. But that's not true, either. The S&P 500 has delivered a 5.8% average gain over the past five fall seasons, according to data from S&P Capital IQ. Stocks have risen in each of the past six fall seasons with the sole exception of 2012 when the S&P 500 fell 2.1%.

The strength of markets - historically at the end of the year - reflects the importance of big institutional investors like mutual funds and pensions that tend to do quite a bit of buying. There's plenty for investors to worry about, reflected in the market's flirtation with a correction. But the season of fall isn't one of them.

Paste BN markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.