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NEW YORK (CNN/Money) -
Summertime, when the livin' is easy -- but the stock market is tough.
Not only do investors find themselves in the midst of what's widely regarded as the "worst six months" of the year, but they're about to enter the worst of the worst: the summer.
The third quarter -- which stretches from July through the end of the summer -- is by far the worst quarter for stocks, with the S&P 500 gaining a whopping 0.1 percent, on average, in the quarter during the last 60 years, according to Standard & Poor's.
What's the best quarter? The fourth. The stretch from October through December has brought an average gain of 4.4 percent.
Wall Streeters also wrestle with lighter trading volume and increased volatility in the dog days, as many investors head for the beach or the boardwalk and aren't necessarily focused on buying stocks.
The period is also tough because the market sees "less capital inflows, no IRAs -- which happen in the first and fourth quarters -- no pension money coming in, and no tax refund money coming in," said Sam Stovall, chief investment strategist at Standard & Poor's.
Stovall said it's also when professional stock pickers get something of a reality check. "It's the time when analysts might say, 'My optimistic forecasts from early in the year were really too much, I need to reassess,'" he added.
Here's another thing: summer, to some extent, is counter-intuitive for investors, or should be. In other words, you really shouldn't buy what you know, or rather, what's all around you. Movies and entertainment? Hotels and other lodging? These stocks and sectors are among the worst performers in the summer.
Overall, of course, the market's had a weak year so far, with the Dow industrials down 2.3 percent and the S&P 500 index down 1.2 percent year-to-date. The Nasdaq composite index is off 4.8 percent.
So is there anything to suggest that this summer will be different?
"Not really, as we've had a pretty typical first and second quarter," said Jeffrey Hirsch, editor-in-chief of the Stock Trader's Almanac. "It looks like we'll see the traditional minor summer rally."
Markets are set up for a June tech-stock rally, Hirsch said, which is typical. "There also tends to be a broader July 4th rally, and then after that, a lot of lower volume and a flat-to-lower bias through the rest of the season."
But even with summer weakness, there are some places to look. Here are a few of them.
The stars, the duds
Stocks you'd think would do well in the summer but probably won't include movies and entertainment. The sector, on average, has fallen about 8 percent in the third quarter.
That's due to the impact of big, diversified media companies, such as Walt Disney (Research), which over the last six years have seen modest declines in the period, especially in recent years.
But there are a few smaller standouts in the entertainment sector, said Jon Markman, a money manager at Greenbook Investment Management who tracks seasonal stock patterns.
Once and possible future Disney partner Pixar (Research) is notable. The stock's gained about 5 percent in June, on average, during the last six years and outperforms the S&P 500 nearly 90 percent of the time. Things heat up for Pixar even more in September, when its average gain is 10 percent.
Then there's Lion's Gate Entertainment (Research), which released the recent film "Crash." The stock's risen about 5 percent in July in recent years and does especially well in September, when it gains 11 percent, on average, Markman said.
Biotech stocks also tend to be strong starting in August and stretching through the winter.
"Biotech is one of the best groups to trade on a seasonal basis because the stocks tend to trade up in advance of or during conferences," Markman said. The utilities sector also tends to be strong in the period between April and December.
On the downside, natural gas names have a tough time in June and July, with the sector falling, on average, about 6.4 percent, according to the Almanac. Airlines have a rough July through September period, tumbling about 18 percent, on average.
Tech stocks tend to do well, particularly in June.
Among Markman's picks: Broadcom (Research), which rose, on average, 23 percent in June over the last six years, outperforming the S&P 500 83 percent of the time.
Cognizant Tech Solutions (Research), an Indian information tech firm, has gained 15 percent in June over the last six years, and outperformed the S&P 500 in each of those years.
In addition, Markman added, both stocks have charts that look pretty good.
Markman does not own shares of the stocks mentioned and his firm has no investment banking ties to the companies.
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