The S&P 500 gained 7.8% in Q3 2025.
For context, that is the 13th largest gain for the index going back to 1950.
Pretty good for 76 years of data.
Chart: ranked Q3 S&P 500 returns in all years since 1950.
Q3 tends to be the weakest quarter on average, so 2025 did “buck the trend” vs the traditional seasonal playbook.
But what would be “normal” to expect in Q4 for a year with this strong of a Q3?
That’s what I set out to answer in the next chart.
Below I’m showing the S&P 500’s average Q4 path after a Q3 gain of at least 7.8% (like we had in 2025).
Chart: S&P 500 average Q4 path when Q3 up at least 7.8% (n=12).
Q4 is up 7.7% on average, with most of the gains being back-loaded (Nov & Dec).
Here are each of those instances (12 total) separated out so you can see the Q4 returns in each year.
Chart: Q4 S&P 500 returns when Q3 is up at least 7.8%.
5 out of 12 saw Q4 higher by double digits.
4 out of 12 saw Q4 higher by between 5% and 10%.
The rest saw sub 5% gains.
But the common thread among each instance?
Every single one saw a higher Q4 when Q3 was up at least 7.8% (like we had in 2025).
That’s a 100% win ratio.
Can this Q4 be different?
Absolutely.
But if you’re using seasonality as a framework (and this is just the data, not my opinion), a strong Q4 would be completely normal.
That’s all for today. Thank you as always for reading and please consider sharing this newsletter with a friend if you enjoyed!