Amidst the turbulence of the US stock market, will the "Sell in May" curse still be effective?

As U.S. stocks rebound recently, investors face an old but powerful spell: "Sell in May and go away." Historical data shows that the cumulative return of U.S. stocks from May to October is significantly lower than in the winter and spring seasons, and this seasonal factor is particularly noteworthy against the backdrop of uncertainty surrounding Trump's tariff policies. The "Sell in May" effect is a well-known phenomenon in financial markets, with long-term historical data providing strong support for it. An analysis by Bespoke Investment Group shows that if one invests in a fund established in 1993 that tracks the S&P 500 index, the cumulative return from May to October each year is 171%; while from November to the following April, the cumulative return reaches as high as 731%. This pattern last appeared during the period from November 2023 to October 2024. Longer-term data analysis is even more astonishing: according to the Stock Trader's Almanac, over the past seventy-four years, the cumulative return of investing in the S&P 500 index from May to October has only been 35%, while in the other half of the year, the cumulative return has soared to 11,657%. Seasonal data is particularly important this year. Tyler Richey, co-editor of Sevens Report Research, stated: "This year, the balance of the 'Sell in May' strategy has shifted," adding that the risk of a significant decline in the S&P 500 index in May is increasing. According to Bespoke's data, if the S&P 500 index experiences negative growth from the beginning of the year to April, the SPDR S&P 500 ETF Trust (SPY) typically declines by an average of 0.4% during the subsequent May to October period. As of Tuesday, the fund has already dropped 5.4% this year, further increasing the likelihood of a seasonal decline in the upcoming May to October period. Richey also pointed out that as the market enters May, volatility increases, making seasonal patterns particularly relevant. Although the Chicago Board Options Exchange Volatility Index (VIX) has retreated from multi-year highs earlier this month, it still hovers around 25, well above the long-term average of about 20. Tariff factors may become a key variable, noted Jay Woods, global chief strategist at Freedom Capital Markets: We are now in a tariff world. We are more controlled by Washington and tariff discussions than by any seasonal trends