Markets drop in Sept

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Hi, I’ve been reading that generally, the expectation is that the markets drop significantly every September. Why is that?This September has not been good…can you give a brief insight into this?

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Asked on September 15, 2021 7:50 am
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Makes sense Mat! Thanks for the overview. Good time to pick up stocks that are slightly down, which is what I did yesterday! Thanks

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Posted by Pamela Branch
Answered on September 16, 2021 9:54 am
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Hi there,

Yes September is typically a weaker month than most. I don't think there is any official reason for this, but in my opinion it is because it follows the summer which is a seasonally low volume period for stocks. Many investors take a break from investing and volume drops considerably. So what you are likely seeing is more selling pressure as investors/funds, etc start rebalancing everything after a summer of lower activity.

There is also another factor - several mutual funds have September as a year end and those are likely exiting their losing positions and harvesting tax losses.

Mat

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Posted by Mathieu Litalien
Answered on September 16, 2021 4:48 am