December has a magic of its own, doesn't it? Whether it's the holidays, New Year's Eve celebrations, or the irresistible spread of good food, there's something special about this time of year.
It’s a season filled with activity and reflection—and not just in our personal lives.
The stock market also tends to sparkle in December. Historically, this month has been a strong one for equities.
Since 1950, the average cumulative December performance of the S&P 500 paints a picture of steady gains—but the real fireworks usually happen toward the end of the month.
This phenomenon is referred to as the “Santa Claus rally.”
Starting the last five days of the year and extending into the first two days of January, this rally has a reputation for delivering outsized returns.
It's like the market decides to gift investors a little extra trading gains.
However, it's when Santa does NOT show that we want to get more interested. If we don’t see an end-of-year rally, it can signal trouble ahead.
As our friend Jeff Hirsch and his father before him like to say…
“If Santa Claus should fail to call, bears may come to Broad and Wall.”
Last month, JC had a great session with Jeff, diving deep into how seasonality plays a role in markets.
This was part of the ASC Mastermind Lab Course, where JC shares his go-to strategies for analyzing markets, managing his portfolio, and finding solid stocks to buy.
