25 Stocks to Avoid in September: Historical Trends and Insights

2025-09-05 06:52:13 Reads: 30

Explore stocks to avoid in September based on historical trends and market behavior.

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25 Stocks to Avoid in September, Historically

As we step into September, investors often look for historical trends that can guide their decision-making. The month of September has a reputation for being one of the worst months for stock market performance, and certain stocks tend to underperform during this time. In this article, we will analyze the potential short-term and long-term impacts of avoiding specific stocks during September, considering historical trends and market behavior.

Historical Context

Historically, September has yielded negative returns for the S&P 500, with an average decline of about 0.5% since 1950. This trend can be attributed to various factors, including profit-taking after the summer months, the return of institutional investors from their summer breaks, and broader macroeconomic concerns that often surface in the fall.

For instance, in September 2001, the market experienced heightened volatility following the events of 9/11, leading to a significant decline in stock prices. Similarly, in September 2008, the financial crisis began to unfold, causing substantial drops in stock indices. Such historical precedents suggest that September may bring increased uncertainty and volatility, impacting stocks negatively.

Potentially Affected Indices and Stocks

Given the historical context, certain sectors and stocks may be more susceptible to underperformance in September. Here are some indices and stocks that investors might want to consider avoiding during this month:

Indices

S&P 500 (SPX)
Dow Jones Industrial Average (DJIA)
NASDAQ Composite (IXIC)

Stocks

Tech Sector: Stocks like Apple Inc. (AAPL), Microsoft Corp. (MSFT), and Amazon.com Inc. (AMZN), which have historically seen profit-taking in September.
Consumer Discretionary: Companies like Tesla Inc. (TSLA) and Nike Inc. (NKE) may face headwinds due to seasonal spending patterns.
Financials: Stocks such as Goldman Sachs Group Inc. (GS) and JPMorgan Chase & Co. (JPM) could react negatively to economic data releases that typically occur in September.

Short-term Impacts

In the short term, avoiding these stocks could lead to better portfolio performance, especially if we see a continuation of historical trends. Investors wary of increased volatility and potential downturns may choose to liquidate positions in these stocks, leading to downward pressure on prices. As a result, the S&P 500 and other major indices may also reflect this cautious sentiment.

Long-term Impacts

While September's performance might not have lasting effects on stocks in the long run, the psychological impact of historical performance can influence investor behavior. If investors see a pattern of underperformance, they may be hesitant to invest heavily in these stocks until after September, potentially creating a cyclical trend that perpetuates the issue.

Moreover, if macroeconomic indicators released during this month signal economic weakness, it may lead to longer-term sell-offs in specific sectors, particularly if those sectors are already underperforming historically.

Conclusion

As we navigate through September, keeping an eye on historical trends can be an important strategy for investors. The potential effects of avoiding certain stocks and indices can help mitigate risk and enhance overall portfolio performance. By understanding the patterns of the past, investors can make informed decisions that align with their financial goals.