October throughout the years
This market update everything focuses on October! And that’s why we have looked at all October months of the last 10 years 🍂
October was the worst month at stock markets this year. Even US stock markets have experienced a tremendous loss in value and therefore the world’s stock market had to note a minus of 7.5% in October (based on MSCI World Index in USD). 📉
So, has the Halloween month October in general been haunting investment decisions in recent years? 🎃
In order to come up with an educated answer, we have looked at data from October from the last 10 years
This is how we sum up the findings:
The average return in October is negative with -0.27%. This means you would have lost money if you would have only invested in October.
When excluding October 2008 (Financial crisis!), the return was about 1.59%. In theory, this would compound to 20.80% looking at the whole year! 🤓
Apart from monthly returns, the MSCI World grew from 2008 to 2018. The growth was a clear 70.65%.
What does this mean for me as an investor?
The insight does not really shine a light on specific investments. But, the analysis explains clearly that even though October months look dark and spooky on a short-term basis, in the long run they do not keep your investments from growing. And there we go again: Long-term investing in order to not depend on short-term changes in the markets is key!
At the end, we have arrived at a quick “Trick or Treat” announcement, as you’d say at Halloween! 👻
Donald Trump always shines with surprises that affect the markets instantly. This time it seems to be a “treat” instead of a “trick” though!
After the bad start of the month, the last two days in October have been very positive. Donald Trump announced a “Big Deal” with China, which sparks hope that it will be able to avert the imminent trade war between the US and China. And this lets the Emerging Markets finally start climbing again! 🌱