Despite the rocky finish, investors will be sad to see Q1 come to a close. Below we have provided a summary of the S&P 500’s average return by quarter going all the way back to WWII and just over the last ten years. Over the long-term, average returns in Q2 are actually pretty similar to Q1 with the S&P 500 averaging a gain of 1.9% compared to an average gain of 2.2% in Q1. In terms of consistency, both Q1 and Q2 have seen positive returns 62% of the time. Over the long-term, the real weakness for equities has come in Q3 when the S&P 500 averages a gain of just 0.5% and then bounces back in Q4 with an average gain of 3.8%. In terms of consistency, though, Q3 isn’t quite that different from Q1 and Q2 as it posts gains 60% of the time. Q4, however, has been the clear leader with positive returns 78% of the time.
Over the last ten years, Q2 hasn’t been as friendly to bulls. As shown in the chart on the right, Q2 has historically been the worst quarter of the year for the S&P 500 over the last ten years posting an average gain of 1.4% with gains 60% of the time. In every other quarter, the S&P 500’s average gain has been greater than 2.5% with positive returns 80% of the time. Also notable is the fact that Q2 is the only quarter where the average gain over the last ten years is lower than the long-term average (1.4% vs 1.9%).
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