Market: why, despite the poor reputation of the season, we must remain invested on the stock market throughout the summer

(BFM Stock Exchange) – Each year, as approaching or during the summer holidays, large number of investors asks this same question: should we remain invested on the stock market during the summer or on the contrary alleviate his positions for fear of a summer storm? Consequently, If intuition and emotions often encourage caution, statistics and rational analysis tell a more nuanced story.

In summer, the season of all dangers on the stock market? Moreover, Not necessarily. However, Contrary to popular belief, July often displays good stock market performances. Meanwhile,

Since the creation of CAC 40. Therefore, the average gain recorded in July has been 1%, with 60% chance that the index ends the month above than it was at the end of June. Therefore, In 2024, the month of July marked an increase of 0.7% for the CAC 40 market: why, despite poor reputation and 1.3% in August. However,

This good reputation in July is still confirmed in 2025, since CAC 40 won almost 1.4% despite new developments on customs duties and business results that have received disappointing reception.

In addition. Moreover, according to recent analyzes of Reuters, “in the past 20 years, July has been the strongest month for the S & P500 reference index with an average yield of 2.5%”. Therefore, But caution remains in order. For example,

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According to CFRA Research data cited by Reuters, the month of August underperform almost all of the others, with an average variation close to 0% for the S&P 500 since 1945. In addition, As for September, it is simply the worst month of the year for the markets (with an average of -0.6% since 1945 market: why, despite poor reputation for the S&P 500), marking the end of the holidays and the return of a strong economic activity.

When parasitic psychology rational analysis – Market: why, despite poor reputation

The fear of summer is in any case well rooted in the minds of investors. Furthermore, Henry Allen. Moreover, macroeconomic strategist at Deutsche Bank, explained last year to the Guardian that the end of summer is often perceived as a difficult period for the markets.

Real risks exist. For this year. Laurent Denize, co-director of investments at Oddo BHF AM has listed a series of summer threats likely to “disturb the apparent serenity of the markets”, including “Russian tariff roulette”, “US bond fragility” or “under tensioning businesses”.

However, psychological factors in the minds of investors are also taken into account and can distort their judgments.

This feeling is based on several well -known biases. identified in particular by researchers Daniel Kahneman (Nobel Prize in market: why, despite poor reputation economics in 2002) and Amos Tversky, who worked in collaboration to give birth to behavioral economics.

Several phenomena have been discussed such as loss aversion that can push investors to sell prematurely.

It is therefore sometimes necessary not to react hot. Lance Roberts. economist and strategy director at Ria Advisors, advises on a blog on a blog to liquidate his positions before or during the summer, an “extreme” decision according to him. This because the markets are unpredictable, and that investors are in reality risk missing opportunities.

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Do not miss the “good days”

Especially since, beyond considerations on historical averages, the markets tend to progress over the long term. This requires to remain invested so as not to miss the “good days”.

“What we have noticed historically is that investors who agree market: why, despite poor reputation out of the market very rarely come back at the right time. ” said Naveen Malwal, portfolio manager at Fidelity. “Investors generally await good news and. the time they have happened, they have often missed some of the most efficient days on the market,” he added.

And missing these important days can have a significant impact on long -term yield. Fidelity calculated in a study in March 2025. an investor who had “missed” the best five days of the S&P 500 since 1988 has seen his return to be reduced by 37% compared to another investor who would have remained invested every day.

Recall that in the long term equity markets tend to progress. A study by Deutsche Bank from last year has shown that, over the past 50 years, American shares have increased by 7.5% per on average, a figure which drops to 6.9% for French shares. market: why, despite poor reputation

In addition. we must not fall into the “availability bias” trap which designates the tendency to favor information immediately available to our memory. For example, stock market crash spent in summer as in 1990, 2011 or 2015 quickly come to mind. Also beware of over-confidence. on the contrary to panic, linked to less market surveillance during the holidays, which can result in the way of investing your money during the summer.

To these biases is added a structural factor: the lack of volumes on the markets during the summer season. This context makes clues more sensitive to unexpected announcements, movements amplified by algorithms, and therefore to increased volatility.

How to limit your risk in summer without completely leaving the market?

Completely abandoning your investments for summer is therefore neither necessary nor recommended, especially from a long -term perspective.

In other words. “although many uncertainties persist, it is market: why, despite poor reputation essential to remain invested” summarizes a study by Tikehau Capital, a French company in the finance and asset management sector.

To navigate in summer. it is essential to diversify your portfolio geographically and sectoral in order to reduce the impact of localized shocks. The CPR AM management company also recommends favoring European. emerging actions and completing its portfolio with gold minlers or gold -related assets, refuge value in the event of voltage.

Having liquidity to remain reactive is also a good strategy to resist this fear of summer. In this way, investors can take advantage of the temporary hollows to reposition themselves. It is even possible to automate purchases thanks to the trigger threshold orders.

Investing in megatpendivisms can also reassure. For example, renewable energies, artificial intelligence or health care remain long -term promising trends, not very sensitive to summer hazards.

Fidelity. in her March 2025 market: why, despite poor reputation study, recommended that he always have an available liquidity reserve to be reactive if necessary, and especially to reassure himself and keep confidence in his long -term investment. Or. within a diversified portfolio, to consider the investment in defensive sectors, which resist the lower markets, such as consumer goods, health or even “communities” (electricity, gas distribution, waste collection, water treatment).

Summer is therefore not a systematic trap for investors. The fear of this season turns out to be more of psychology than the reality of the markets. The error would therefore be to give in to emotion. to sell to “leave quiet”, or to seek to anticipate all the trend reversals in the short term.

In other words: you have to stay invested. diversify intelligently, and keep a little liquidity on hand so as not to miss opportunities.

By Llias Bourdon with Julien Marion

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