Top Sectors in August Based on Seasonal Patterns

Are you looking for a strategy that may give your portfolio a boost during what’s historically been one of the weakest months of the year for stocks? Well, our seasonal analysis in the LPL Chart of the Day highlights specific sectors and industry groups within the S&P 500 Index that have consistently outperformed the benchmark in August over the last 20 years—uncovering potential investment opportunities to benefit your portfolio during this seasonally fragile time period.

On average, the S&P 500 has lost 1.0% during August over the past 20 years, though history has shown that stocks moved higher during this month 55% of the time during the period measured. And when August has generated positive returns for the S&P 500, the average monthly gain has been 2.0%; when negative, the average return has been -3.5%. Importantly, nonseasonal factors still influence performance and should not be ignored.

A variety of sectors have tended to exhibit relative strength during August historically. Unsurprisingly, some of the more defensive areas have fared best, but the information technology and utilities sectors have exhibited the strongest returns with the widest breadth compared to the broad benchmark. However, if you are interested in a more targeted strategy, you may consider industry-level investments like the technology hardware & equipment, semiconductors & equipment, and software & services groups, which have posted strong average relative returns with a greater breadth and frequency of outperformance; or the household & personal products industry group, which has significantly outperformed the index in August over the past 20 years.

One way to potentially help strengthen your portfolio during a historically weak period for stocks is by incorporating seasonal statistics into your overall investment management process. Stay tuned for future seasonal analysis updates on the LPL Research blog.


The Standard & Poor’s 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

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