S&P Average Monthly Returns, 1975 - 2009

Chart of the Week for November 6 - Nov 12, 2009

The chart above illustrates the average monthly return from 1975 to 2009, by month, for the S&P 500 Index. Since the months of November and December 2009 are not yet complete, the data points for those two months reflect only the 1975-2008 time period.

It is clear that the average monthly return for the S&P 500 varies across months. For example, the month of April has historically posted the largest average gain (2.10%). In contrast, September, February, and October are the bottom three months in terms of average return (-0.61%, -0.01%, and 0.41%, respectively).

Taking a closer look at the data reveals that timing the market based solely on monthly average returns could be a risky proposition. While September and February posted a negative average return, both months had a higher frequency of positive returns than negative returns during the illustrated time period. From 1975-2009, there were 18 instances of positive returns during the month of September and 17 instances of negative returns. Clearly, investment decisions should not be based on just calendar month returns. The market cannot be easily predicted, which makes sticking to a disciplined investment strategy important to long-term success.

This illustration was compiled by information from outside sources. These companies are not affiliated with ICMA-RC. This information is being provided for educational purposes and is not intended to be construed as or relied upon as investment advice. ICMA-RC does not offer specific tax or legal advice. Individuals are advised to consider any new investment strategies carefully prior to implementing.

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The performance data quoted represents past performance. Past performance is no guarantee of future results. Investment returns and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data illustrated. For performance data current to the most recent month end, contact ICMA-RC Services, LLC by calling 800-669-7400 or by writing to 777 North Capitol Street, NE, Washington, DC 20002-4240. Para asistencia en Español llame al 800-669-8216. Performance data current to the most recent quarter end is available by visiting www.icmarc.org.