Market risk: Weakest part of Presidential Cycle starts in mid 2013 (Jul/Aug peak)
2013 is the first year of a new Presidential Cycle. The first quarter of the first year of the cycle is down 1.33% on average (1Q in 2013 bucked this trend), but the weakest period of the Presidential Cycle is from a July/August Year 1 peak to a September Year 2 (mid-term election year) low. The average decline over this period is 4.31%. With the rally in September, 2013 is bucking this weaker Presidential Cycle period so far.
Source: Merrill Lynch, TBP