How can you not love December? Sure, the snow and cold can certainly get to you, but the promise of a visit from old Saint Nick quickly puts that thought in the back of our minds. People are out spending money and spreading holiday cheer. There is so much happiness surrounding December that even pessimists on Wall Street cannot help the smiles on their faces... ok let's not go that far. So with so much euphoria in the air, December must be the best month of the year in terms of return on investment, right?
Wrong! When compared to the rest of the months, December comes in third place right behind June, and July. In fact, December has proven to be one of the most volatile months from year-to-year. Yes, Virginia, there is such a thing as a Santa Claus rally but it does not have as much of an impact on the market as many people think. Truly, the rally only occurs in the week between Christmas and New Year's Day.
If your expectations for large returns do happen to come up a bit short, don't let it get you down. Nobody wants to hear "humbug!" at their dinner table on Christmas day.
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).