Reducing investment over the summer 'still a good approach'

The traditional trading approach of ’sell in May and go away’ is still applicable despite the rise of newer strategies for investing private wealth.

This is according to new research from Standard and Poor’s, which revealed there is no major European market where average performance over the summer is stronger than it is at the start of the year.

Between June and August, indexes in the eurozone are ’characterised by sluggish performance or a loss’, the company said, with the biggest economy, Germany, seeing an average loss of 1.42 per cent over the summer months, compared to a 3.33 per cent increase between January and May.

’By selling out your holdings in May, and reinvesting them only when the summer is over, you protect your portfolio and potentially achieve better returns,’ the company said in a statement, while Alka Banerjee, vice-president of global equities, added the season effect remains ’a very significant factor’ when investing on the European markets.

Indexes around Europe have been suffering recently, as investors are concerned about the ongoing debt problems in some countries.ADNFCR-2318-ID-19800983-ADNFCR