Indicator of the Week: The 23 Best Stocks to Own After Easter

SPX stocks are a mixed bag in the days before and after the Easter weekend

Senior Quantitative Analyst
Apr 12, 2017 at 5:40 AM
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Markets are closed this Friday for Good Friday, as we celebrate Easter over the weekend. I figured this was a fitting time to see how the market has performed around the holiday. Also, I found an interesting stat on what Easter means for the rest of the year. Finally, I'll see which stocks have historically performed well in the week following Easter. 

Stock Market Returns Around Easter


The table below looks at how the S&P 500 Index (SPX) has performed in the days around Easter over the past 30 years. The day before Easter is a good day, but it is sandwiched between historically underperforming days. Two days before the holiday (today), the index averages a loss of 0.15% and is positive just 43% of the time. Then, the day before Easter has been pretty bullish over the past 30 years, averaging a gain of 0.44% and positive 67% of the time. Compare that to a typical day for the index: a gain of 0.04% and positive 54% of the time. The day after Easter has tended to give back some of those pre-Easter gains. Over the past 30 years, the Monday after Easter has averaged a loss of 0.14%, and been positive only 43% of the time. Historically, it has been wise to avoid stock exposure over the weekend, if you can.

spx easter returns april 11

Pre-Easter S&P Performance Indicates More Gains in 2017


I thought the data below was interesting. It suggests that the pre-Easter return in a year is a precursor for what to expect the rest of the year. When the SPX was positive through the Easter holiday, then the rest of the year was positive 85% of the time, averaging a gain of 9.42%. When stocks were negative through Easter, then the rest of the year returned a loss, on average, of 1.60% -- and are positive just half the time. Hopefully this tendency continues this year, as the S&P 500 is up about 5% in 2017.

spx rest of year returns after easter april 11

The Best and Worst Stocks the Week After Easter


Why would certain stocks tend to outperform or underperform in the week after Easter? I really can't think of a reason that makes sense, other than randomness. But I ran the numbers anyway. Looking at SPX stocks over the past 10 years, the first table below shows the stocks that have done the best in the week after Easter. They have all been positive at least eight of 10 years, and averaged a gain of 1.5% or better. The second table shows stocks that have performed the worst after Easter.

best stocks after easter april 11

worst stocks after easter april 11

 

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