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Mark Hulbert: Get ready for the stock market’s October surprise

Fasten your seatbelts. October is just around the corner, and historically it’s the most volatile month of all for stocks.

The data are summarized in the chart, below. (For the statisticians among you: The standard deviation of the Dow Jones Industrial Average’s DJIA, +0.08% daily percentage changes in past Octobers is 1.44%, in contrast to 1.08% across all 12 months taken together.)

You might think that October is an outlier because of the 1987 Crash; on Oct. 19 of that year the Dow fell 22%. But that year accounts for only a small portion of October’s above-average volatility; October tops the monthly volatility rankings even if we exclude 1987.

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