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A Historic Look at the 3rd Quarter

By Nathan Goodwin

The third quarter of 2015 has come to an end, and many are happy to see it go. What we see when the dust settles is the worst quarter in four years. While the Dow was hit hard (down 7.9% for the quarter), other indexes around the globe saw much greater declines. The two biggest drops came from the Shanghai Composite, down 24.69%, and the Chinese Nikkei, down 14.47%.

The reasons for these declines are numerous and highly debated at the moment, but that’s not the purpose of this blog. As we enter October, let’s take a look at historical 4th quarter returns compared to the rest of the year. This is by no means an indication or prediction of what’s to come, only a look at averages over time.

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Not only does the 4th quarter have the highest average return since 1950, it’s also been positive more consistently than the others. It’s also interesting to note that September is the only month that has a negative average over the past 65 years. Again, this is not a prediction of how the market will perform as we close out 2015. But, for those of you who like numbers, like myself, these figures can be an interesting review of how the market performs over time.

*All information taken from Ibbotson SBBI 2015 Classic Yearbook

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