Sell In May and Go Away? - Nope!

Does selling equities in May really work?

You’ve heard it before:

“Sell in May and go away”

Like all these sayings I often think there’s some truth in them, after all, they must have come from somewhere…right??

So I decided to quickly test a few things using ChatGPT.
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​#1 Shorting 1000 shares of SPY at the beginning of May and closing at the end
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#2 Shorting 1000 shares of SPY at the beginning of May and closing at the end of October (this is supposedly what the saying means…)
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I uploaded monthly SPY data from 1993 to 2023 into ChatGPT, asked it the right questions, and here were the results:
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​Strategy 1: – $24k


Strategy 2: – $110k

Summary:
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Blindly shorting is historically a bad idea… (I mean we kinda knew that, stock markets go up in the long run)
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If you’re an investor, fidelity also showed how not being invested in the market during May would have limited your gains over the years:
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​https://www.fidelity.co.uk/markets-insights/investing-ideas/investing-ideas/does-sell-in-may-and-go–away-work/​

*Note, I didn’t double-check ChatGPT’s backtest, which you should if you were going to rely on it to trade with. I was just curious.
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Sell in May and go away?
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Well, for traders, historically it seems like a bad idea.
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Will 2024 be any different?
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​Let’s leave the catchy phrases to CNBC and just trade price eh…