Market Timing via Monthly and Holiday Patterns

The stock market displays a medley of patterns that can be used as the basis for a timing strategy. A prime example is the frequent surge of the market around the turn of the month as well as the run-up to a holiday.

On one hand, the timing strategy does have its shortcomings. A case in point is the need to dart in and out of the market more than a dozen times a year. Another drawback is the need to deal with the tax impact of short-term rather than long-run capital gains.

In spite of the limitations, though, trading with the calendar can turn in higher profits at less risk than the mundane policy of buying stocks and holding them forever. As a result, a timing strategy based on monthly cycles and market holidays represents a free lunch on Wall Street.

More on Market Timing via Monthly and Holiday Patterns.

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