This chart shows that buying and holding stocks beats ‘sell in May and go away’ and other gimmicks

The "sell in May and go away" adage holds that investors should exit equities around May and return in the autumn, based on the historical tendency for stocks to post weaker returns over the summer months. This year, that approach has run into a familiar problem: markets do not follow calendars. Investors who stepped aside in May have missed a stock rally, according to the report, underperforming a simple buy-and-hold approach.

The episode illustrates a broader point about market timing. Seasonal patterns are drawn from long-run averages and say little about any single year, and the cost of being out of the market during strong stretches can be substantial. Trading in and out also introduces transaction costs and tax consequences that a passive stance avoids.

For observers, the takeaway is not that seasonality is meaningless, but that it is a weak foundation for an investment plan. What to watch: whether the summer rally persists, how the autumn months actually perform, and whether investors continue to favor staying invested over calendar-based moves.