27 for 27

[REWahoo]

Will this year make it 28 for 28?

Since 1945, there have been 27 years when the S&P has achieved gains in January and February. The stock index then finished up for the year (on a total-return basis) in every one those years...

...by an average of 24%.

Of course YMMV, past performance is no guarantee of future results, yadda yadda...

Marketwatch

 

[exnavynuke]

I'm up 24% YoY right now, so I'd be okay with another 19% or so gain over the rest of the year myself on top of that...

 

[DEC-1982]

Do you know why they chose 1945 as the starting year? Is that all the data that they have? or were there different results before 1945?

 

[pb4uski]

No need to be greedy... I'll settle for the average of 24%.

 

[EvrClrx311]

Since 1945, there have been 27 years when the S&P has achieved gains in January and February.

I wonder what they mean by "achieved gains" in January and February. More than just 27 of the past 72 years were up by Mar 1st of the year.

Maybe it means gains in each January, and in February? Which I think is more likely, though lost in the context of how it's written. However, in 1962 the market was up in January 1.7% and up in February 0.1% (0.0996866989% to be exact) but then finished the year down 9% total. I suppose someone could use some creative math to round the February gain down to 0% and call it "not a gain" to exclude it from this chart... though the S&P did go from 70.22 to 70.29 that month... which is certainly a gain

Maybe it means, gains of more than X percent... in those first two months, which makes the lure of this statistic less majestic (and maybe why it was left out?).

Maybe I'm missing something here?

Anyway, I decided to look at the inverse of this for comparison... and see what Jan and Feb looked like in the years the S&P fell (which isn't as often as you'd think)

In fact, when counting for dividends, there have only been 16 years (in total return) that the S&P lost value since 1945. Here they are, along with what happened in January and February

2008 the S&P500 was down 4.4% by Mar 1st and finished down 37% for the year
2002 the S&P500 was -up- 1.2% by Mar 1st and finished down 22% for the year
2001 the S&P500 was down 11.2% by Mar 1st and finished down 11% for the year
2000 the S&P500 was -up- 1.2% by Mar 1st and finished down 9% for the year
1990 the S&P500 was down 0.4% by Mar 1st and finished down 3% for the year
1981 the S&P500 was -up- 0.1% by Mar 1st and finished down 5% for the year
1977 the S&P500 was down 3.1% by Mar 1st and finished down 8% for the year
1974 the S&P500 was -up- 1.4% by Mar 1st and finished down 27% for the year
1973 the S&P500 was down 5.1% by Mar 1st and finished down 15% for the year
1969 the S&P500 was down 2.6% by Mar 1st and finished down 9% for the year
1966 the S&P500 was down 4.8% by Mar 1st and finished down 10% for the year
1962 the S&P500 was -up- 1.8% by Mar 1st and finished down 9% for the year
1960 the S&P500 was down 5.2% by Mar 1st and finished down 1% for the year
1957 the S&P500 was down 3.1% by Mar 1st and finished down 9% for the year
1953 the S&P500 was down 0.7% by Mar 1st and finished down 1% for the year
1946 the S&P500 was down 2.7% by Mar 1st and finished down 12% for the year

Anyway, there are years the market was -up- in Jan and Feb (cumulative) but lost on the year. In fact, as recently as 2002, the market was up over a percentage in January/February but lost 22% on the year by Dec 31st.


References:
(yearly returns: http://www.moneychimp.com/features/market_cagr.htm)
(Jan 01 - Mar 01 returns per year calculated from Shiller data)

 

[DrRoy]

Great if it happens, but I'm not counting on it.

 

[exnavynuke]

I wonder what they mean by "achieved gains" in January and February. More than just 27 of the past 72 years were up by Mar 1st of the year.

Maybe it means gains in each January, and in February? Which I think is more likely, though lost in the context of how it's written. However, in 1962 the market was up in January 1.7% and up in February 0.1% (0.0996866989% to be exact) but then finished the year down 9% total. I suppose someone could use some creative math to round the February gain down to 0% and call it "not a gain" to exclude it from this chart... though the S&P did go from 70.22 to 70.29 that month... which is certainly a gain

Maybe it means, gains of more than X percent... in those first two months, which makes the lure of this statistic less majestic (and maybe why it was left out?).

Maybe I'm missing something here?

Anyway, I decided to look at the inverse of this for comparison... and see what Jan and Feb looked like in the years the S&P fell (which isn't as often as you'd think)

In fact, when counting for dividends, there have only been 16 years (in total return) that the S&P lost value since 1945. Here they are, along with what happened in January and February

2008 the S&P500 was down 4.4% by Mar 1st and finished down 37% for the year
2002 the S&P500 was -up- 1.2% by Mar 1st and finished down 22% for the year
2001 the S&P500 was down 11.2% by Mar 1st and finished down 11% for the year
2000 the S&P500 was -up- 1.2% by Mar 1st and finished down 9% for the year
1990 the S&P500 was down 0.4% by Mar 1st and finished down 3% for the year
1981 the S&P500 was -up- 0.1% by Mar 1st and finished down 5% for the year
1977 the S&P500 was down 3.1% by Mar 1st and finished down 8% for the year
1974 the S&P500 was -up- 1.4% by Mar 1st and finished down 27% for the year
1973 the S&P500 was down 5.1% by Mar 1st and finished down 15% for the year
1969 the S&P500 was down 2.6% by Mar 1st and finished down 9% for the year
1966 the S&P500 was down 4.8% by Mar 1st and finished down 10% for the year
1962 the S&P500 was -up- 1.8% by Mar 1st and finished down 9% for the year
1960 the S&P500 was down 5.2% by Mar 1st and finished down 1% for the year
1957 the S&P500 was down 3.1% by Mar 1st and finished down 9% for the year
1953 the S&P500 was down 0.7% by Mar 1st and finished down 1% for the year
1946 the S&P500 was down 2.7% by Mar 1st and finished down 12% for the year

Anyway, there are years the market was -up- in Jan and Feb (cumulative) but lost on the year. In fact, as recently as 2002, the market was up over a percentage in January/February but lost 22% on the year by Dec 31st.


References:
(yearly returns: CAGR of the Stock Market: Annualized Returns of the S&P 500)
(Jan 01 - Mar 01 returns per year calculated from Shiller data)

There is probably a reason they chose only those years where the market was up in both January and February instead of up cumulatively across those months, because the data makes a juicier story that way and a better story = more clicks.

 

[tn3sport]

I wonder what they mean by "achieved gains" in January and February. More than just 27 of the past 72 years were up by Mar 1st of the year.

Maybe it means gains in each January, and in February? Which I think is more likely, though lost in the context of how it's written. However, in 1962 the market was up in January 1.7% and up in February 0.1% (0.0996866989% to be exact) but then finished the year down 9% total. I suppose someone could use some creative math to round the February gain down to 0% and call it "not a gain" to exclude it from this chart... though the S&P did go from 70.22 to 70.29 that month... which is certainly a gain

Maybe it means, gains of more than X percent... in those first two months, which makes the lure of this statistic less majestic (and maybe why it was left out?).

Maybe I'm missing something here?

Anyway, I decided to look at the inverse of this for comparison... and see what Jan and Feb looked like in the years the S&P fell (which isn't as often as you'd think)

In fact, when counting for dividends, there have only been 16 years (in total return) that the S&P lost value since 1945. Here they are, along with what happened in January and February

2008 the S&P500 was down 4.4% by Mar 1st and finished down 37% for the year
2002 the S&P500 was -up- 1.2% by Mar 1st and finished down 22% for the year
2001 the S&P500 was down 11.2% by Mar 1st and finished down 11% for the year
2000 the S&P500 was -up- 1.2% by Mar 1st and finished down 9% for the year
1990 the S&P500 was down 0.4% by Mar 1st and finished down 3% for the year
1981 the S&P500 was -up- 0.1% by Mar 1st and finished down 5% for the year
1977 the S&P500 was down 3.1% by Mar 1st and finished down 8% for the year
1974 the S&P500 was -up- 1.4% by Mar 1st and finished down 27% for the year
1973 the S&P500 was down 5.1% by Mar 1st and finished down 15% for the year
1969 the S&P500 was down 2.6% by Mar 1st and finished down 9% for the year
1966 the S&P500 was down 4.8% by Mar 1st and finished down 10% for the year
1962 the S&P500 was -up- 1.8% by Mar 1st and finished down 9% for the year
1960 the S&P500 was down 5.2% by Mar 1st and finished down 1% for the year
1957 the S&P500 was down 3.1% by Mar 1st and finished down 9% for the year
1953 the S&P500 was down 0.7% by Mar 1st and finished down 1% for the year
1946 the S&P500 was down 2.7% by Mar 1st and finished down 12% for the year

Anyway, there are years the market was -up- in Jan and Feb (cumulative) but lost on the year. In fact, as recently as 2002, the market was up over a percentage in January/February but lost 22% on the year by Dec 31st.


References:
(yearly returns: CAGR of the Stock Market: Annualized Returns of the S&P 500)
(Jan 01 - Mar 01 returns per year calculated from Shiller data)

Hey, I love the work and analysis you did.

I see the March 1, 1962 closing price, which matches what you posted, but I can't find a source for the Feb 28, 1962 closing price. Maybe that's the number they used to determine if Feb 1962 was an "up" month. All I can find is the March 1 closing price.

Reason I asked is that I took this Marketwatch story at face value and figured it was accurate. I'm really watching to see if this Feb (as a standalone month) does in fact, close "up".

I'm in the camp that the promise of lower corp taxes, reduced regulation, and protectionism are going to drive the market for 2017. After that, who knows, but if Feb does close "up", I think it could be a good year. Again, I don't know...

 

[REWahoo]

Following up from this thread from February.

Will this year make it 28 for 28?

Quote:
Since 1945, there have been 27 years when the S&P has achieved gains in January and February. The stock index then finished up for the year (on a total-return basis) in every one those years...

...by an average of 24%.

The answer is yes. However, the 19% gain by the S&P 500 was a little below average.

Looks like January and February gains in the index is a great predictor of market returns for the year - until it isn't.

 

[NW-Bound]

I somehow missed this thread when it started. But looking at the chart in the OP, what struck me was the return in 4 consecutive years.

1995 - 38%
1996 - 23%
1997 - 33%
1998 - 29%

I was too busy working those years, and did not follow the market at all. Did not even care to see what my 401k and after-tax MFs were doing. Good thing I had at least some money in the market.