The October Country is a book written by one of the most prolific writers of the 21st Century, Ray Bradbury…
Bradbury was known for being able to add a human element to all of his stories – making them relatable to anybody – regardless of the setting of his stories.
The October Country is a collection of sci/fi, horror, and suspense stories that can be outright chilling…
And if you’ve been paying attention to the markets lately, that same October chill seems to have taken over stocks as well.
Looking back at the history of Wall Street – it seems like a lot of bad things happen in October – most notably, the Crash of 1929.
And it seemed this October 10th and 11th – we were witnessing something somewhat similar – as the markets dropped a cumulative 1,300 points.
Scary, right?
However, there’s something that a drop of this magnitude often signifies…
And it’s FAR from a horror show.
Yes, it is crazy to think that October is such a volatile time for stocks, especially during an election year. So much so, that a phrase was coined – “October-phobia.”
Now, obviously the events of this 10th and 11th may have spooked more than a few of the top traders and analysts out there – but the truth is – fear is the wrong emotion they should be feeling or dwelling on…
Because historically – massive October selloffs often give way to a turnaround, particularly in a midterm election year.
So, investors shouldn’t be scared right now – they should be EXCITED! And all they’d have to do to know that is to look at what’s happened before.
According to The Stock Traders Almanac, the Crash of 1929 may have been due to an occurrence of October-phobia, as were the dips and drops of ’78, ’79, ’87, ’89, and 2008.
However…
After we experienced those losses – we witnessed turnarounds.
Get this fact- of the 12 bear markets we’ve experienced since WWII – 8 of them were during a midterm election October – and almost all of them not only recovered, but surpassed their previous advances.
Jeffrey Hirsch, Editor-In-Chief of The Stock Traders Almanac recently told a source, “Midterm election years’ Octobers are downright stellar thanks to the major turnarounds.”
How’s that for a ringing endorsement?
But he expounds on this October’s dip, “These things always surprise everybody or else they wouldn’t look like this. It’s not unprecedented. It’s definitely something that could easily turn around.”
And we have historical data to back that up…
Again, according to the Stock Traders Almanac, October is a month we should be happy to be in, as it’s a traditionally a “sweet spot” for gains.
What makes it so “sweet?”
Well, during the three-quarter period that includes a fourth quarter of midterm year and the first and second quarter of the pre-presidential election year…
The Dow is up an average of 20.4%…
And the S&P is up an average of 21%.
And if the activity of the 12th is any indication – we may just be on our way to another surge, as the Dow closed up 287 points – meaning that during the “horror show” of a week – stocks closed down only 4.2% for the week.
That’s not too shabby, especially considering that the 1,300 point drop would have been massive.
This is why I love data…
Data doesn’t lie. Hard data is also difficult to manipulate – which is why I truly believe it gives you a clearer picture of what is actually going on.
It also happens to be why I believe that GorillaTrades works so well.
We don’t allow fear or rumor or excitement to rule our decision-making. And I’ll be the first to admit – it can be easy to give into those emotions sometimes…
When you watch a stock you could have bought for pennies on the dollar start soaring or one of your stalwart performers starts bleeding value profusely – believe me – the finger may itch to hit that “buy” or “sell” button.
But in my experience, that emotion is usually the wrong one.
By taking the emotion out of the buying process – we take the “chance” out of it.
I’d rather KNOW that the data supports my actions than find out that I made a huge mistake a few days later.
If you’ve noticed that you’ve sometimes gotten swept up in one of Wall Street’s feeding frenzies – you may want to give GorillaTrades a try.
Our recommendations come on the heels of hard data – so there’s no emotion involved – allowing my subscribers to make their purchases or sells while remaining as cool as a cucumber.
And if you’re going to be in the high stress business of buying stocks – a little calmness can go a LONG way.
We’d love for you to join us – but totally understand that GorillaTrades isn’t for everyone. However, if you ever change your mind – we’ll be here for you.
In the meantime, if you found yourself getting a little nervous this month – relax. History shows that this may just be a momentary glitch in the matrix.
In any case, I’d suggest buckling up – we may be in for one hell of a ride.
“We are not makers of history. We are made by history.” – Martin Luther King, Jr.