The SPX tends to outperform during the week of Christmas
Next Friday is Christmas Day, and this means a short week for U.S. financial markets -- as they'll be shutting down at 1 p.m. ET on Thursday. With that in mind, we decided to take a look at how the S&P 500 Index (SPX) historically performs during shortened weeks, more generally, and the week of Christmas, more specifically.
The chart below is courtesy of Schaeffer's Senior Quantitative Analyst Rocky White. Looking back 50 years, the SPX has been positive 56% of the time on a weekly basis, with an average return of 0.14%. As you can see, short weeks are more bullish, with the percent positive at 58% and the average return at 0.31%. Christmas weeks are even more bullish, with the SPX finishing higher about two-thirds of the time, and posting a typical gain of 0.53%.
Looking more closely, you'll notice that short weeks and Christmas weeks are also less volatile, as is clear in the standard deviation row. So while the gains are smaller in short weeks, the losses are also tamer. For example, the average anytime weekly loss for the SPX is nearly 1.7%, but for short weeks it's just 1.3%, and for Christmas weeks it's an even milder 1%.
What about individual stocks? White has that covered, too, in the charts below. First is a list of the 25 stocks that have performed best during Christmas week over the last decade, looking strictly at names trading at least 1 million shares per day and over $10 per share. Gold bugs should be happy to see Goldcorp Inc. (USA) (NYSE:GG) at the top of the list, up 90% of the time for an average gain of 3.5%.
Meanwhile, the list below displays the 25 worst stocks during the past 10 Christmas weeks. Despite sitting on a more than 17% year-to-date gain, eBay Inc (NASDAQ:EBAY) could hit a snag next week, if past is prologue.
