SHOULD YOU BUY STOCKS BEFORE THE MIDTERMS? HISTORY SAYS YES — EVERY TIME

Investors have recently been rocked by a big sell-off in the tech sector, especially in AI-related semiconductor stocks. Add in the ongoing war in Iran, higher inflation and interest rates, and the uncertainty over the midterm election, and it is no wonder stocks have largely sold off heading into November.

But should you buy the dip? According to the history of returns for the S&P 500 after midterm elections, you most definitely should, the Motley Fool argues.

Since 1950, investors buying at the end of October during a midterm year have been treated to subsequent positive 12-month stock market gains 100% of the time. The average return is 16.6%, with a median return of 16.3%. The lowest one-year return was 3% in 2014, while the highest was 33.6% in 1954.

Even on a short-term basis from October through the end of the year, the average return was positive at 3.6%, with a median return of 3.2%.

The S&P 500 fell 1.82% in the latest session to 7,580.07, with the Dow down 1.09% to 51,770.31 and the Nasdaq 100 down 3.46% to 28,384.85 — a sell-off that, if history is any guide, may be setting up the very buying opportunity the history books keep rewarding.