When is the best time to by stocks?

[dan_s]

From Bank of American Equity Research

4Q is best quarter of the year for SPX going back to 1928
Although October can struggle after a down September, especially in an election year,
seasonality back to 1928 shows that 4Q is the best quarter of the year for the S&P 500
and this favors buying into October dips. 4Q is up 73% of the time with average and
median returns of 2.6% and 4.5%, respectively. These returns do not rule out SPX 3450 -
3500 into yearend.

Election year: 4Q second best but most likely to be up
After a summer rally, the Presidential Election year often shows volatility ahead of the
election in September and October followed by a rally into yearend ( September rears its
ugly head ). While 4Q is the second strongest quarter of the election year in terms of the
percentage return of the SPX, it is the best quarter in terms of the percentage of time
that the SPX is up. 4Q of the Presidential Election year shows the SPX up 74% of the
time with average and median returns of 1.9% and 2.9%, respectively. This suggests
potential to SPX 3425-3460 into yearend .

4Q is even stronger when SPX is up YTD
The SPX was up 4.1% YTD as of September 30, 2020. When the SPX is up YTD through
September, 4Q is much stronger than average and is up 82% of the time with average
and median returns of 4.1% and 4.7%, respectively. The same scenario occurs when the
SPX is up YTD through 3Q in the Presidential Election year with 4Q up 88% of the time
in 4Q with average and median returns of 4.6% and 4.2%, respectively. These returns
make a case for SPX 3500-3520 into yearend
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MY TAKE: When a viable vaccine for COVID-19 is announced, the market will have a MAJOR TAILWIND.