Have you heard this well-known proverb Sell in May and Go Away?
Well, I’m here to tell you it’s not always the case. But first of all let us try to understand Where and How this proverb ‘Sell in May and Go Away’ came to be. And what really Investors like you and me will do in May.
The phrase sell in May and go away is likely a take on an old English saying, “Sell in May and go away, and come on back on St. Leger’s Day.” This phrase refers to the custom of aristocrats, merchants and bankers who liked to leave the city of London and go to the country to escape the heat during the summer months. St. Leger’s Day refers to the St. Leger’s Stakes, a thoroughbred horse race in mid-September and the last leg of the British Triple Crown.
American traders who are likely to spend more time on vacation between Memorial Day and Labor Day mimic this trend and have adopted the phrase as an investing adage. However, the numbers also support this bit of folk wisdom.
That’s the short history about the proverb, sell in May and go away.
So, here we go… What you and me really have to do in May? Allow me to suggest 3 concrete steps:
- Buy with caution
It means buy additional shares of your stocks this month of May. But with caution means, you should check our Buy Below prices before buying. Always buy stocks that are equal of below our Buy Below prices. No excuses.That is to maximize your growth potential in the future. What we mean is, the lower you buy the stock prices the higher the potential of gains you will have in the future.Because we are long term investors.
- Buy with caution
- Sell on target price
Most of the time at around halfway of the year stock prices reached their peak or target prices. This is your opportunity to sell a portion or all your shares to lock down your profit.Why sell when there is a potential for stock prices to go higher? Because nobody knows how high the prices can go, that is why discipline is very important. We need to follow our target price. See our target prices in Stock Pick page.When the target price is reached sell a portion or all shares, period.
- Add more money
This is the heart of investing. Add more money to your portfolio. Whatever the case maybe, whether the stock market gains or losses always add more money to your portfolio.The bigger the capital the higher the gains!Of course, how would your money grow if you don’t add your capital, right? That is why continue to perform well in your daily job. When you receive your salary, always set aside a small amount for savings and investment.Add more money regularly to have A better portfolio for a better life!
That’s it! Sell in May and go away! And as always, keep on learning and earning soon!
I wish you all the best in your stock market investment!