Funds up 10% in August: the rally nobody saw coming

The August funds: up 10% and nobody knows why

August has always been the month of scares. The average investor knows it: it's when markets tumble, when black holes swallow the Ibex, and when you review your portfolio with one eye closed. So this year, when a client of a traditional bank saw that his investment funds (the ones the bank's salesperson had placed with him with a solemn air) had gained nearly 10% in just a few days, with profits of more than 2,000 euros, his first thought was that there had to be a mistake. Or a trick.

The political explanation

What's going on? The explanations run in opposite directions. One camp looks to the United States: with the midterm elections in November, the country would be tapping its strategic petroleum reserve to keep prices in check so that nothing shows up in the economy. Another camp points to October, the month that historically breaks the summer. Meanwhile, stocks like Repsol keep climbing, and some are already asking "where is the limit?" with a wink at a famous line from the investing world.

The skeptic's warning

The problem is that winning is not the same as winning. A rise in the value of funds doesn't miccionan anything has been sold: it's an accounting entry, paper. One month — and an August at that — proves no skill. To talk about real returns you need to keep up the pace for a year and, above all, have actually cashed in. Meanwhile, the investor from the beginning still holds his funds intact, without having shaved off a single euro. And August isn't over yet.