The September Effect: S&P 500 and NASDAQ’s track record

While lower September returns in the major market indices are common, their significance fades when we consider lifetime investing strategy and historical long-term gains.

By Jack Caporal – Updated Sep 17, 2025 at 11:08 AM

Key Points

The S&P 500 and the NASDAQ show weakest returns in September, but long-term growth remains strong.
Despite September dips, S&P 500 and NASDAQ annual returns average 8% and 11.5%, respectively.
Investors can focus on long-term holdings in index funds and ETFs to ease the sting of September slumps.

Loading paragraph...

Data source: MacroTrends (2025). Author’s calculations.
Period	Positive Septembers	Negative Septembers	Average September return
Since 1950	34	41	-0.6%
Since 1980	22	24	-0.9%
Since 2000	13	13	-1.4%

Loading table...

Loading pitch...

Average S&P 500 returns by month and year

Aside from September, February is the only other month to average a negative S&P 500 return since 1950, delivering investors -0.03%.

Despite concerns about an October Effect following the September doldrums, October has actually delivered an average return of 0.9% for investors. The months following – November, December, and January – have some of the strongest average returns since 1950.

Loading paragraph...

Loading infogram...

Looking annually, the S&P 500 has delivered an 8% annualized return since 1950, a 9% annualized return since 1980, and a 6% annualized return since 2000 despite Septembers that are sometimes duds. Over the long term, the S&P 500’s returns have historically been an unmatched wealth-creation machine.

Loading paragraph...

Data source: MacroTrends (2025). Author’s calculations.
Period	Annualized return	Average monthly return
Since 1950	8.2%	0.7%
Since 1980	9.3%	0.8%
Since 2000	6.1%	0.6%

Loading table...

How the NASDAQ has performed in September since 1985

The NASDAQ isn’t immune to the September Effect. In fact, it has performed worse than the S&P 500. Since 1985, the NASDAQ has had an average return of -0.9% in September and has had 18 positive Septembers versus 22 negative ones. Since 2000, the average NASDAQ return in September has been -1.9%, with 12 positive months and 14 negative.

Loading paragraph...

Data source: MacroTrends (2025). Author’s calculations.
Period	Positive Septembers	Negative Septembers	Average September return
Since 1985	18	22	-0.9%
Since 2000	12	14	-1.9%

Loading table...

Still, the NASDAQ has posted positive average returns for each month outside of September. Like the S&P 500, the NASDAQ’s November, December, and January post particularly strong returns, on average.

Loading paragraph...

Loading infogram...

Despite rocky Septembers, the NASDAQ’s annualized return is an impressive 11.5% since 1985 and 6.8% since 2000. Like the S&P 500, the NASDAQ has been a reliable source of returns over the long term even if September tends to be a down month.

Loading paragraph...

Data source: MacroTrends (2025). Author’s calculations.
Period	Annualized return	Average monthly return
Since 1985	11.5%	1.1%
Since 2000	6.8%	0.7%

Loading table...

Loading pitch...

Loading paragraph...

Loading faq...

Loading pitch...

About the Author

Jack Caporal is the Research Director for The Motley Fool and The Motley Fool Money. His work focuses on uncovering and analyzing trends that shape personal financial decisions across the United States, to help people become smarter, happier, and richer. Jack's primary research has been featured across top-tier television networks, and accredited publications like the New York Times, Bloomberg, CNBC, and has been cited in Congressional testimony. He previously followed business and economic trends as a reporter and policy analyst in Washington, D.C. Jack enjoys spending time in the mountains and cheering for his hometown Boston sports teams.

TMFJackCap

The Motley Fool has a disclosure policy.

The September Effect: S&P 500 and NASDAQ’s track record

While lower September returns in the major market indices are common, their significance fades when we consider lifetime investing strategy and historical long-term gains.

Key Points

Average S&P 500 returns by month and year

How the NASDAQ has performed in September since 1985

About the Author

Premium Investing Services

Sources

Is the September Effect real? How stocks have historically performed in September

How the S&P 500 has performed in September since 1950

Average S&P 500 returns by month and year

How the NASDAQ has performed in September since 1985

What causes the September Effect?