S&P 500 Aug-Oct Win Probability Drops to 55% With 7.35% Avg Drawdown

Historical data shows S&P 500 faces weakest seasonal window Aug-Oct, with only 55% gain probability and -0.02% avg return, favoring defensive assets like gold.

Woofun AI data shows that from 1928 to present, the August-to-October rolling three-month period represents the weakest cycle for the S&P 500, featuring a 55% probability of positive returns, an average return of -0.02%, and an average drawdown of 7.35%. Bank of America Securities notes that defensive assets, including the U.S. dollar, gold, and Treasury bonds, have historically outperformed equities during this window. Since 1992, gold has risen in 61% of these periods with an average gain of 2.52%, while the U.S. dollar typically strengthens against the British pound and Australian dollar in August. The report clarifies that seasonal trends do not guarantee equity declines, as long-term performance remains dependent on corporate earnings, monetary policy, economic cycles, and valuations.