History Says the Nasdaq-100 Does This in September. AI Investors Should Take Note.

Historically, September has been one of the worst months for stocks, with the S&P 500 (SNPINDEX: ^GSPC) averaging a decline each September from 1928 to 2023. That's not to say there haven't been profitable Septembers, but the average return being a decline suggests it's worth being prepared for a potentially bumpy month. In September 2022, for example, the S&P 500 dipped by 9.3%.

Looking at the Nasdaq-100, an index comprised of the 100 largest non-financial companies listed on the Nasdaq stock exchange, we also see that conditions have become noticeably bumpy around September in recent years. The historical performance of that index is worth paying attention to for artificial intelligence (AI) investors, as it currently includes tech heavyweights such as Advanced Micro Devices, ASML, Micron Technology, and Nvidia.

Here's what the data tells us, as well as what history suggests is the best move to make during what's typically a turbulent month.

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How the Nasdaq-100 performs in September

From 2017 to 2025, the average return for the Nasdaq-100 in September was a 2.1% loss. In addition, 67% of the time during September, the Nasdaq-100 has experienced a negative return.

One of its worst September performances came in 2022, when it dropped 10.6%. The Nasdaq-100 also dropped by more than 5% in the Septembers of 2020, 2021, and 2023. One of its best performances for the month since 2017 was in September 2025, when the Nasdaq-100 climbed 5.4%. While it isn't a guarantee that the Nasdaq-100 will post a negative return in September, history suggests there's a higher-than-average probability that it will.

That said, history also offers other data points worth considering for long-term investors.

The bigger picture

While Septembers have been rough for the Nasdaq-100 since 2017, things have started to look better in October, and even better in November. From 2017 to 2025, the average return for the Nasdaq-100 in October was 1.1%. During those years, November's average Nasdaq-100 return was 4.2%, and 78% of those months were profitable.

With that data, this may seem like an ideal time to sell stocks and wait for October or November to get back into the market. But history also offers another lesson: The amount of time you are invested in the market is more important for your overall returns than trying to time the market.

According to a study by Hartford Funds, from 1996 to 2025, 48% of the 50 best days for the S&P 500 occurred during bear markets. Only 28% of the best days occurred during the first two months of a bull market, while 24% of the best days occurred during the rest of a bull market. For anyone selling in fear of a bear market, history also shows that it can be a costly mistake, because missing out on those few great days on Wall Street can take a huge toll on your overall returns.

To illustrate, consider this. If someone had invested $10,000 in the S&P 500 in 1996 and kept it there until 2025, that initial investment would have grown into a position worth $192,167. But missing just the 10 best days of the market would have reduced that return by 56% to $85,490. Missing the 20 best days would drop that return by 74% to $49,511. And missing the 30 best days would have lowered the return by 84% to $31,123.

Sticking with long-term investments

It's always nerve-wracking to watch stocks struggle, and AI stocks can be especially prone to quick, deep declines during broader market sell-offs. The face of the AI trade, Nvidia, has experienced some particularly painful sell-offs during Septembers, with shares dropping 11.8% in September 2023, 19.5% in September 2022, and 7.4% in September 2021. That said, Nvidia shares have also been up by an average of more than 5% in both October and November from 2017 to 2025.

The data shows panic-selling or trying to time the market doesn't work out in the long run. Instead, an investor who has deep conviction in their investments could use any pullbacks next month as a time to consider adding more shares. While a stock could have a rough month, that will pale in comparison to the returns it could offer over the years ahead.

Jack Delaney has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ASML, Advanced Micro Devices, Micron Technology, and Nvidia. The Motley Fool recommends Nasdaq. The Motley Fool has a disclosure policy.