Avoid September's market pain in 9 ways
Watch out! September is usually an ugly month for stocks. But a few stocks have lived through the dreaded month and survived to tell the story.
There are nine stocks in the Standard & Poor's 500 index, including biotech Regeneron Pharmaceuticals (REGN), health-care data provider Cerner (CERN) and financial rating firm Moody's (MCO), that have bucked the traditional bad month of September, according to a Paste BN analysis of data from S&P Capital IQ. These stocks have each beaten the market each and every of the past five Septembers, but have also posted average gains during the month of more than 6%.
It's hard to find a month that's been more hazardous to your portfolio's health than September. Stocks in the S&P 500 have dropped 0.5% on average during the month since 1950, says The Stock Trader's Almanac. That makes it the worst month for stocks on a percentage basis.
But don't tell Regeneron investors that. Shares of the company have gained 11.7% on average in September the past five years. The stock has only fallen in one of those Septembers, and that was back in 2011. But even then, Regeneron dropped just 1.4% -- while the market lost 7.2%.
Another example of a stock thriving in September is Cerner. Shares of the company that provides technology tools to healthcare companies have gained each of the past five Septembers and have posted an average gain of 8.5% during the month. Investors looking for growth and the relative safety of the health care industry get both with Cerner. The company's revenue has grown 24% during the most recent 12-month period compared with the same period a year ago.
While stocks might be ugly in September, bonds hold up much better. The same holds true for shares of Moody's, which is one of the largest bond-rating companies. The stock has posted an average gain the past five Septembers of 8%.
Much of the fear over September has been overstated the past five years. The S&P 500 has gained an average gain of 1.1% over the past five Septembers - even including the 7.2% hit in September 2011 amid worries about Greece.
Yet - investors are going into this September pretty scared. There are new worries like China to worry about. Volatility has already worked into the market - in August. But investors can still find ways to profit - even in the year's most hated month.
Follow Matt Krantz at Twitter @mattkrantz