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This month's historical sector analysis of September felt very much like I was attending a history class. I lived through this history, but it was still painful to look back over the last 25 years. The market has had to deal with a wide range of historical September events, from its strange September performance leading up to the '87 crash; to its' reaction to the August 1990 Iraqi invasion of Kuwait; to the despicable terrorist attacks of September 11, 2001; to the mortgage crisis becoming a household name in 2008; to the downturn due to the European debt crisis in 2011.

There are only so many lows that can be thrown out for statistical analysis. Obviously, the historical returns for the broad-based market are going to be negative, but it may surprise you to learn that there has been strength in quite a few sectors in the month of September over the last 25 years. Not just strength over the 25 year period, but sectors that have been able to achieve a positive mean return on a 25, 20, 15 and 10 year trailing basis. The sectors that have been able to achieve these positive returns on an average basis are health care, real estate, telecom, energy and utilities. It should not be surprising (especially with September's problems well-documented) that many of the leaders are considered defensive sectors.

However, one sector that has been consistently hammered in September is industrials. Industrials have been the single worst performing sector on a trailing 25, 20, 15 and 10 year trailing basis.

As with anything, the longer you go out, the more normalized the data should become. The trailing 15-year period just had far too many negative world events impacting returns to be able to provide positives. Stretch that analysis out just five more years, and you will notice that all but one sector was able to achieve a positive mean return. Heading into this September, the markets are faced once again with headline risk. From the Jackson Hole symposium this week, to a September decision looming from a German court that could "make or break" the European debt crisis, to the continued slowdown in China, it is easy to see why the S&P 500 lost a bit of steam last week. With solid gains on the books year-to-date, it may be wise to sit on the sidelines going into these events.

Sept

Consum Discr

Health Care

Energy

Financials

Consum Staples

Technology

1987

-3.79%

-2.06%

-3.48%

-2.99%

-1.01%

0.03%

1988

6.95%

3.79%

-2.02%

3.39%

4.01%

3.33%

1989

0.55%

2.48%

-0.41%

1.51%

0.42%

1.61%

1990

-8.92%

-5.04%

-1.13%

-10.13%

-3.19%

-9.47%

1991

0.13%

1.63%

-3.65%

-0.47%

-1.76%

-2.04%

1992

2.23%

-2.49%

2.91%

2.57%

1.68%

2.63%

1993

4.26%

3.23%

-1.82%

2.76%

-0.32%

2.78%

1994

-0.96%

1.09%

1.15%

-3.90%

0.19%

2.12%

1995

1.52%

5.87%

-0.23%

3.36%

7.85%

3.14%

1996

4.84%

6.47%

4.66%

5.24%

3.39%

10.31%

1997

7.04%

9.20%

7.61%

8.37%

6.09%

5.10%

1998

1.23%

13.09%

19.45%

3.20%

3.27%

12.43%

1999

-0.20%

-5.60%

-3.90%

-3.55%

-5.79%

3.38%

2000

-1.14%

4.64%

0.66%

3.95%

0.76%

-9.59%

2001

-13.23%

-5.53%

-10.51%

-6.37%

-4.50%

-21.83%

2002

-6.96%

-4.29%

-7.46%

-10.81%

-7.79%

-14.84%

2003

-3.01%

0.45%

-1.97%

0.64%

0.67%

-2.93%

2004

3.36%

2.25%

10.22%

0.93%

-2.13%

4.93%

2005

-2.22%

0.59%

6.10%

0.61%

0.23%

2.15%

2006

5.15%

0.30%

-5.75%

3.45%

0.70%

3.06%

2007

0.68%

3.88%

8.97%

2.71%

4.90%

5.01%

2008

-9.73%

-6.70%

-20.95%

-5.10%

-3.31%

-14.92%

2009

5.37%

2.56%

9.65%

2.99%

3.83%

6.21%

2010

12.51%

9.86%

10.64%

7.99%

8.21%

13.03%

2011

-7.15%

-5.38%

-14.75%

-11.23%

-6.20%

-6.78%

# Of Up Years

14

17

11

16

15

17

Mean

-0.03%

1.21%

0.24%

0.09%

0.43%

0.33%

Standard Deviation

4.86

4.54

6.70

4.81

3.68

7.15

Trailing 10yr Mean

-0.60%

0.05%

0.63%

-0.57%

-0.16%

-0.40%

Trailing 15 yr Mean

-0.58%

0.99%

0.73%

0.05%

-0.11%

-0.52%

Trailing 20 Yr Mean

0.24%

1.51%

0.90%

0.59%

0.63%

0.79%

Sept

Telecom

Nat Resources

Real Estate

Utilities

Industrials

S&P 500 TR

1987

1.86%

-1.49%

-2.13%

-1.17%

-2.22%

-2.19%

1988

5.88%

-1.37%

2.00%

2.87%

4.51%

4.26%

1989

2.17%

-0.89%

-0.26%

0.84%

-2.28%

-0.41%

1990

-5.13%

-2.77%

-5.43%

-0.11%

-10.00%

-4.87%

1991

2.34%

-1.78%

2.00%

2.87%

-1.31%

-1.67%

1992

1.22%

0.85%

2.35%

0.52%

2.70%

1.18%

1993

1.37%

-2.78%

4.52%

-0.12%

-0.08%

-0.77%

1994

-0.74%

0.94%

-1.68%

-2.16%

-4.73%

-2.45%

1995

3.59%

-0.03%

2.16%

4.51%

0.21%

4.22%

1996

3.13%

2.87%

2.61%

0.91%

2.77%

5.63%

1997

7.64%

6.43%

9.52%

5.87%

4.46%

5.48%

1998

8.91%

16.28%

5.17%

7.33%

1.15%

6.41%

1999

3.24%

-1.20%

-3.71%

-0.26%

-4.99%

-2.74%

2000

-9.26%

-0.79%

3.48%

2.83%

-4.09%

-5.28%

2001

-10.07%

-10.47%

-4.14%

-7.15%

-15.04%

-8.08%

2002

-12.28%

-6.05%

-3.69%

-9.49%

-8.41%

-10.87%

2003

-0.92%

-1.16%

3.28%

2.24%

-3.25%

-1.06%

2004

3.69%

9.55%

0.22%

2.22%

4.11%

1.08%

2005

2.32%

5.58%

0.44%

3.42%

1.76%

0.81%

2006

3.66%

-5.92%

1.85%

-0.59%

2.81%

2.58%

2007

5.39%

9.52%

4.55%

4.64%

3.28%

3.74%

2008

-17.49%

-18.96%

-2.01%

-13.25%

-13.71%

-8.91%

2009

7.17%

6.05%

6.66%

3.14%

5.28%

3.73%

2010

10.76%

10.19%

4.46%

4.70%

12.44%

8.92%

2011

-7.72%

-17.27%

-10.43%

-3.61%

-10.89%

-7.03%

# Of Up Years

17

10

16

15

12

12

Mean

0.76%

-0.09%

0.99%

0.74%

-1.43%

-0.28%

Standard Deviation

5.83

6.43

3.35

3.72

5.40

4.49

Trailing 10yr Mean

0.16%

0.04%

1.14%

0.25%

-0.66%

-0.62%

Trailing 15 yr Mean

0.14%

0.34%

1.27%

0.61%

-1.73%

-0.71%

Trailing 20 Yr Mean

0.57%

0.35%

1.47%

0.65%

-1.20%

-0.08%

ETF ideas for each sector:

Cons Discretionary Select Sector SPDR (XLY)

Vanguard Health Care ETF (VHT)

Financial Select Sector SPDR (XLF)

Technology Select Sector SPDR (XLK)

SPDR S&P Telecom (XTL)

iShares Cohen & Steers Realty Majors (ICF)

Consumer Staples Select Sector SPDR (XLP)

Energy Select Sector SPDR (XLE)

Utilities Select Sector SPDR (XLU)

SPDR S&P Global Nat Resources (GNR)

Industrial Select Sector SPDR (XLI)

S&P 500 Index (SPY)

Source: September Historical Sector Analysis: Not Kind