Boston RS Institute: Register to join us in person for a 3-hour educational symposium on relative strength investing. This event is for financial advisors and will offer 3 hours of CFP/CIMA credit.

When: July 24th, 2025, 9 AM EST - 12 PM EST

Where: Courtyard Boston Downtown, 275 Tremont St, Boston, MA 02116

Who: Speakers include...

John Lewis, CMT, Senior Portfolio Manager; Andy Hyer, CFP, CIMA, CMT, Client Portfolio Manager; Ian Saunders, Senior Research Analyst; Michael Silver, Founder and Managing Director of AlphaScale

Cost: Free! Lunch will also be provided.

Registration is limited to the first 75 advisors, so be sure to act fast!

Click Here to Register!

Beginners Series Webinar: Join us on Friday, June 6th at 2 PM (ET) for our NDW Beginners Series Webinar. The week's topic is: Idea Generation with Stocks and Funds. Register Here

The summertime is notorious for being a slower period for financials markets, which can play out into underwhelming returns for equity markets, or a “Summertime Blues.” However, this phenomenon doesn’t extend just to domestic equities, as the summer months are some of the weakest for the cryptocurrency space as well. 

From the start of June to the end of September, Bitcoin ($BTC) has averaged a return of 5.6% over those months. Outside of that period, Bitcoin has averaged a return of 133.7% during the rest of the year, meaning that almost all of Bitcoin’s gains have come outside of the summer months. This is not isolated to just bitcoin as well, as the broader cryptocurrency space has performed noticeably worse during the summer. The DWACRYPTO index— an equal weighted index of the top ten cryptocurrencies by market cap—has averaged a gain of 13.3% from June to September. However, the other eight months of the year blow that out of the water with an average cumulative return of 166.8%.

While seasonality can help investors navigate cryptocurrencies, there’s still exceptions to rule, as June to September were responsible for the majority of Bitcoin's gains in 2021. Additionally, it’s just one lens to evaluate cryptocurrencies through. Another way to identify strength within cryptocurrencies is through the matrix tool. To highlight which cryptoassets hold the most relative strength, we can look toward a 6.5% matrix holdings members of the Nasdaq Crypto Index (.NCI, domestic equity proxies (SPX & SPXEWI), and the money market (MNYMKT). Currently, we see that Bitcoin is the strongest member of the index, sitting atop the matrix. Bitcoin is also the only cryptocurrency to reside on an RS buy signal and in column of Xs versus both the MNYMKT and SPXEWI. It recently returned to a buy signal in May before setting new all-time highs above $110k. However, it has yet to break through the triple top formed at the $108k level. 

One notable name within the matrix is Ethereum ($ETH), which earned near-term strength against all the other members of the matrix after rising almost 85% from its bottom in April. Despite its improvement, Ethereum is still down 21.7% YTD and is now testing its bearish resistance line around $2,700. Currently, it still lies in the bottom half of the matrix due to its lackluster performance over the last year. While the cryptocurrency has improved its near-term picture, we have yet to see follow through into its long-term outlook. However, a return to a positive trend would be another sign in its favor. Broadly speaking, Bitcoin is arguably the strongest name in the cryptocurrency market for now. Although, there is the potential for cooling off as we enter the seasonally weak summer period. 

From peak to trough, the S&P 500 (SPX) declined more than 20% this year. When you’ve been in this business a while you come to understand that corrections and bear markets are a fact of life – this isn’t to say you shouldn’t do everything you can to avoid getting caught in them – but you learn that no matter how bad the headlines are, the market eventually recovers. However, for the uninitiated drawdowns like the one we experienced this year can be gut-wrenching, especially during periods like early April when the S&P dropped more than 12% in five trading sessions. As it turned out, the recovery was similarly swift as SPX rallied more than 9.5% in a single day. No matter how often this pattern repeats it seems it is the lessons of the past are often forgotten at the next downturn. This is why why we thought it might be helpful to provide some statistics about long-term returns and drawdowns that you can use next time you need to provide some perspective for your clients.

On any given day, the odds that the market will be up or down are relatively even. But we know that over the long-term the market tends to go up. As a result, the longer you stay invested, the better the odds are that your investment will be profitable. To get a better idea the probabilities, we looked at the outcome of investing in the S&P 500 everyday since the beginning of 1950. Over the last 75 years, if you put money into the S&P on any given day, the odds that your investment would have gone up a month later were 64%; a year later those odds rise 79% and by 10 years out the odds that you’d have a gain had risen to 97%. And at the 20-year mark, you would have had a gain 100% of the time, with an average cumulative return of 730%. Said another way, if you invested in the S&P 500 anytime in the last 75 years – whether it was the day after Black Monday in 1987 or just before the dot com bubble burst – 20 years later you had a gain.

Of course, just because the S&P reliably produced gains over the long term, doesn’t mean it always smooth sailing. We often think of volatility in negative terms, but it is also the source of all (excess) returns. With an asset like equities with an upward bias, volatility tends to work in your favor over time. But it is a double-edged sword as more time also increases the odds of a significant drawdown.  Since 1950, over any given 20-year holding periods, the S&P 500 has experienced a 20% drawdown 100% of the time. While for a one-year holding periods, the odds of a 20% drawdown were about 50/50. So, while time increases our odds of a positive investment, it also increases the chance of a major drawdown and for buy-and-hold investors it is all but an inevitability.

This is not to say that you should resign yourself or clients to just riding the market up and down year in and year out, if you can effectively use tactical management to cut off some downside, you can greatly improve your performance. But, if you have clients who are constantly nervous about putting money to work or on the verge of a meltdown every time the market falls 5%, hopefully, understanding that the S&P has had major drawdowns and still consistently delivered positive returns will help put them at ease.  

Daily Option Ideas for June 5, 2025