Should You Sell Stocks in May? Here's What History Says.

The article argues against the old 'Sell in May and go away' adage, citing history that the S&P 500 has averaged a 1.5% return in May over the past decade and has risen in each May over the past five years, including 6.2% in May 2025. It also notes the S&P 500 fell in Q1 before rebounding 10% in April amid easing Iran-related geopolitical concerns and stronger AI-related earnings. Overall, the piece is a market commentary encouraging long-term investing rather than seasonal market timing.

Analysis

The bigger signal here is not the calendar effect itself, but the positioning/flow context around it. A widely known seasonal rule tends to create a self-fulfilling risk: systematic de-risking into early summer can temporarily cheapen index exposure, but it also leaves cash on the sidelines that must be re-deployed if earnings stay firm. That setup usually favors high-quality, liquid compounders over cyclicals because any dip is more likely to be bought selectively rather than across the board.

For the named stocks, the most asymmetric second-order beneficiary is NDAQ, not because of fundamentals in the article, but because elevated discussion of seasonality tends to lift retail and advisor trading activity, which supports volumes in market structure businesses. JPM also benefits from a “stay invested” regime if clients rotate from cash into equities rather than exiting risk assets entirely; that tends to favor fee-rich wealth and asset-gathering franchises more than pure beta. NFLX and NVDA remain momentum-sensitive: if the market treats the seasonal call as noise and AI/consumer earnings momentum continues, they re-rate harder than the index because they are the highest-leverage sentiment expressions in the group.

The contrarian miss is that the article underweights how much the market is now driven by a small number of mega-cap growth names and AI capex expectations. If those earnings continue to validate spend, any May weakness should be shallow and short-lived, making “sell in May” a poor timing tool but a decent volatility trigger. On the other hand, if macro data or geopolitics deteriorate, the first pain will likely show up in crowded growth leaders, not in the index average.

Net: this is a positioning article masquerading as a seasonal one. The tradeable edge is not to abandon equities, but to use any early-summer softness to add to secular winners while avoiding names that only work in a broad multiple expansion tape.

Key Decisions for Investors

• Stay net long SPX/NDX through May but add on pullbacks only; use any 2-3% index dip to scale into quality beta rather than de-risking. Risk/reward favors owning strength because seasonal weakness is typically brief while earnings revisions can persist for months.
• Initiate a pair trade: long NDAQ / short low-quality exchange-linked or broad-market beta exposure for 1-2 quarters. The thesis is that higher trading commentary and episodic volatility support volumes, while outright market direction may remain range-bound.
• Buy JPM on weakness over the next 2-6 weeks, targeting a defensive financial compounder versus the market. The risk/reward improves if “sell in May” creates temporary cash drag across cyclicals, because capital often rotates into diversified fee-generators.
• Trade NVDA via call spreads into the next earnings cycle rather than outright stock. If AI capex remains validated, upside convexity is still strong; if seasonal caution caps multiple expansion, defined risk is preferable.
• Avoid shorting NFLX solely on seasonality; if anything, use it as a momentum long only if the tape confirms risk appetite. The stock should outperform in a market that treats the adage as noise, but it is vulnerable if growth leadership rolls over.