Sell in May, Miss the Play

The old saying on Wall Street is that stocks decline when summer begins, i.e., sell in May and go away. Here's some supporting evidence:

Over the last 12 months, investors who held to this belief made out pretty well. From May 1-November 1, 2011, the Dow lost 6.7%. From November 2011 through April 27, 2012, it gained 10.7%...

If we open a historical window – specifically, The Stock Trader’s Almanac – back to 1926, we see the S&P 500 rising 4.3% on average during May-October and gaining an average of 7.1% from November-April.

Following that strategy robotically would have been a mistake if you were an investor in Apple, which yesterday became the most valuable public company in U.S. history.

After an early dip in May the indices have recovered since while Apple is up 15% to an all-time high.

Now that shares of Apple have already hit my target of $650 to $700 from last April, I'm going to take some off the table soon, but definitely before year-end. As another old saying goes, the bulls make money, the bears make money, but the pigs get slaughtered.