Since we do not know the ending numbers for 2024 while I am writing this column, I thought we would visit the statistical probabilities for 2025 and perhaps recall some amazing financial market performances of yesteryears. Remember that there are lies, damnable lies, and statistics!

For years I have consulted the Stock Trader’s Almanac. It was founded by Yale Hirsch 58 years ago. Yale passed on in 2021 and his son, Jeffrey, continues the effort. The statistics are important for serious investors because Mr. Market behaves in a very defined manner based upon all sorts of seasonal and fixed events over time. (By the way, it is not expensive to purchase a copy compared to many investment services.)

For example, 2024 was a presidential election year. In those years since 1950, November has been the best month of the last quarter, while October has usually been a loser. The average of the previous November S&P 500 gains was 2.0 percent.

This year was especially robust at 5.99 percent. October showed a loss of .06 percent, not much but quite a contrast to November. Even though December appears to be ending with a loss of over 2 percent, it has been quite a good year for stocks in general. The S&P 500 index will probably show a gain in excess of 23 percent.

A primary worry of many watchers is that gain has mostly been achieved by a small minority of the 500 companies in the index. Right now, there are 170 stocks that have lost value this year. The overall participation rate of companies in a bullish trend is called breadth. A lack of breadth is a negative indicator. The smaller companies have been notably losers lately.

Typically, this first year of any presidential term is positive in results. The major downtrends usually occur in the second year, 2026 in this case, and 2027 and 2028 would be the best and second best in performance. Only time will tell. There are always major issues that could raise their ugly heads and cause at least temporary collapses. This is why it is my strong opinion that it pays to change portfolio allocations when the technical indicators turn south. You do not need to know the exact day of the turn.

For folks like me with a big part of Attention Deficit Disorder in my core, this is a great industry. New events and observations occur every day and there is never a dull moment! Stay with us as we experience 2025, but one day at a time.

(The 2024 Stock Trader’s Almanac, John Wiley & Sons, 2024.)

Past performance is no guarantee of future results.