Every year, September is marked by a trend that worries investors: massive stock sell-offs. This month has historically been the most challenging for stock markets, but why does this phenomenon occur? In this article we analyze the reasons behind this behavior and the signs that investors should look out for to protect their portfolios.
Why is September the worst month for stocks?
Historical data shows that September has a clear pattern of underperformance in the stock market. Several theories explain this behavior, some of the most prominent being:
The VIX soared 33% in Tuesday’s session, surpassing 20 points. The higher this indicator is, the worse it is for the stock market. Source: Yahoo Finance
September sell-off: What to expect in 2024?
The volatility expected this September is not a surprise, especially in an uncertain global economic context. Factors such as inflation, decisions by the US Federal Reserve and geopolitical tensions are weighing on the market, and are expected to continue to impact the performance of stocks.
How can investors prepare for September?
Investors can take steps to mitigate the impact of this historically challenging month:
Final reflection: How to face September in the financial markets?
While September is known as a tricky month for stocks, being prepared and understanding the reasons behind this behavior can make all the difference. Investors who act strategically, stay calm, and diversify their portfolios are more likely to successfully navigate this period.
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