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The
January Barometer
Brian
Trumbore
President/Editor, StocksandNews.com
An old saying is that as January goes,
so goes the year. And according to the Stock Trader's
Almanac, since 1950 the January indicator has only
five major errors for a 91.2% accuracy ratio. "Vietnam
affected 1966 and 1968; 1982 saw the start of a major
bull market in August; 9/11 affected performance in
2001; and the anticipation of military action in Iraq
held down the market in January 2003."
If
you include the ten flat years, which the Almanac
defines as less than +/- 5% for the S&P for the entire
year (not including dividends), the barometer's accuracy
ratio is 75%; the more common measurement.
So
I thought we'd just look at the past eight years,
specifically, including two of the major mistakes
('01, '03); while throwing in gold and oil just for
the heck of it.
????S&P
500?Return for the year*??...Gold?..Oil
12/31/99?1469????????????..$289?$25.20 1/31/00?..1394?-5.1%.......-9.1
12/31/00?1320?????????????272?.26.80
1/31/01?..1366?+3.5%......-11.9
12/31/01?1148?????????????279?.19.84
1/31/02?..1130?-1.6??..-22.1
12/31/02?.879?????????????.347?..31.20
1/31/03?...855?.-2.7??..+28.7
12/31/03?1111?????????????416?..32.52
1/31/04?..1131?+1.7??.+10.9
12/31/04?1211?????????????438?..43.45
1/31/05?..1181?-2.5??..+4.9
12/31/05?1248?????????????519?..61.04
1/31/06?..1280?+2.5??..+15.8
12/31/06?1418?????????????638?..61.05
1/31/07?..1438?+1.4??..+5.5
12/31/07?1468?????????????838?..95.98
*For
the yearly return, I include dividends. Stock Trader's
Almanac does not. But I'm still including 2007 as
a 'flat' year, based on their methodology; the S&P
being up 3.5% before dividends.
The
January barometer is but another tool, albeit an important
one particularly when the geopolitical scene is sanguine.
However, we have a far from sanguine environment today,
I would argue.
Sources:
"2007 Stock Trader's Almanac," Yale Hirsch & Jeffrey
A. Hirsch?and my own archives for the gold and oil
data.
Wall
Street History returns next week.
Brian
Trumbore
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