Defensive positions to take for expected market falls in September

SEPTEMBER heralds a change of seasons – fall, as it is called in America. September also ushers in the worst performing month of the year. Forget October. Most times, the Dow is higher at the end of October than it was at the beginning.

September is when the market often goes into a funk, with the month ending lower than when it started. Traders and investors will look for shorting opportunities in September and then for bargain entry points in October.

In recent years, the September falls became both more volatile and more unexpected. Volatile because the size of the fall had often been significant, and signalled the potential end of the uptrend. More unexpected because although the month has a reputation for market collapses, there was little warning of when the collapse would develop.