Futures options traders work on the trading floor of the NYSE American (AMEX) of the New York Stock Exchange in New York, the United States, April 17, 2026.
Brendan McDermid | Reuters
Conventional wisdom can be a stubborn force.
With May in full swing this week, should investors continue to follow the old adage “sell in May and leave” – a strategy of selling stocks in May and re-entering the market in November to avoid low returns and low volumes during the northern hemisphere summer?
Testing traditional professionsCurrently, commonly accepted beliefs and traditional business ideas are being challenged.
If April is anything to go by, investors could risk losing returns if they exit stocks now. Europe STOXX600 and Germany DAX just closed out its best month since January last year, while Italy MIB FTSE performed even better, with a nearly 9% rally marking the strongest month since January 2023.
In the United States, the S&P500 And Nasdaq recorded their best monthly performances in around six years.
Much of this is because the Trump administration has been a game-changer for investors. A possible resolution to the war in Iran could boost stocks this spring, as major stock markets around the world have remained remarkably resilient despite the turmoil in the Middle East.
In recent years, investors who sold in May and left JPMorgan’s trading desk pointed out that over the past ten years, the S&P 500 has returned an average of 1.5% in May and 1.9% in June. Yields are even stronger in July, averaging 3.4%.
Do you like actions in summer?In Europe, Deutsche Bank crunched the numbers to see how the “May sale” strategy would play out on this side of the Atlantic. For the Stoxx 600, Deutsche Bank states that “in 25 out of 39 years, the ‘sell in May’ strategy underperformed a simple buy-and-hold strategy… providing no statistical advantage.”
Investors may want to remain more nimble in May, as the coming weeks bring plenty of earnings from European companies. Big names in the banking sector like Unicredit, HSBC And Commerzbank will all release figures in the coming days, while the energy giant Shell and pharmaceutical group Novo Nordisk will also make headlines.
Stock chart iconStock chart icon
European banking stocks over the past month
Risk factorsDespite the record rise in global stocks, alarm bells are also ringing.
Central banks on both sides of the Atlantic maintain cautious tone, Federal Reserve Chairman says Jerome Powell saying “inflation remains high”, ECB President Christine Lagarde warned she was monitoring “the impact of negative supply shocks”, and the Bank of England drew up a worrying worst-case scenario picture for inflation.
With all of these market factors at play, investors will have to choose between traditional trades or more unconventional strategies, but as Deutsche Bank says, the “Sell in May” strategy offers no more certainty than a coin toss.
What to watch this week:Monday: UK bank holiday, April PMI data across Europe
Tuesday: results from Unicredit, HSBC, AB Inbev, Ferrari and AMD
Wednesday: results from Novo Nordisk, Infineon, BMW, Diageo and Disney
Thursday: profits from Shell, Rheinmetall, Maersk, BMPS and AirBnB
Friday: results from Commerzbank, IAG