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Over 300 years of statistics and data show that now is the best time to buy. What does it say?

Jamie Cameron
9. 11. 2022
4 min read

Halloween is the best time of the year to buy stocks. There is even an entire phenomenon named after this holiday. Studies show a long-term trend that suggests that right now is statistically more rewarding to buy stocks. What is the reason for this?

Halloween seems to be statistically the best time of year to buy stocks

I won't dwell on this and get straight to the point - According to financial research, most or all of the stock market's long-term returns come in the winter months.

Professors Cherry Zhang of Nottingham University Business School in China and Ben Jacobsen of the TIAS School for Business and Society in Europe gathered all the data they could get on stock market returns from around the world. It was not just the United States. They described it all in their study "The Halloween Indicator, 'Sell in May and Go Away': Everywhere and All the Time", which you can read here.

"Our data consists of all 114 stock market stock indexes in the world for which there are price indexes, and we have nearly 63,000 monthly returns in total. The sample starts with the UK stock market in 1693 and ends with the addition of the Rwanda stock market starting in 2013," they wrote.

That's quite a sample already.

Their conclusion? Stock markets generally beat cash handily in the winter months. Not so in the summer months.

"Overall, 62,962 monthly observations over 323 years show a strong Halloween effect," Zhang and Jacobsen report. "This effect appears to be remarkably strong, with returns being on average 4% higher between November and April than between May and October."

The comparison with data from other financial instruments is also interesting. Indeed, in 65 countries they also had data showing not only monthly returns in the stock market, but also returns on a traditional deposit account or on short-term bills. "In none of the 65 countries for which we have total returns and short-term interest rates can we recommend the well-known "Sell in May" based on our research." That is, with one exception - Mauritius. In other words, only in Mauritius did it definitely make sense to keep money in the market all year round.

You can find plenty of information about the Halloween effect on the internet:


This Halloween effect seems to defy all economic principles note Zhang and Jacobsen. It has not disappeared, or even retreated an inch, since it began to be widely written about some 20 years ago. Moreover, it has been confirmed by others, such as economics professors Thomas Degenhardt and Benjamin Auer of the University of Leipzig, Germany, who conducted a methodical review of all academic studies on the Halloween effect and confirmed that the findings are "robust".

What about other studies?

Not to be stuck with just one effect - more recent research, meanwhile, has found, for example, that high-quality stocks tend to do better in the summer months and, conversely, more trendy, unfairly valued stocks tend to do better in the winter: Put another way, risk-taking has traditionally been best rewarded from November to May. Moreover, the summer months certainly appear to be a period of volatility. We have seen that this year.

Why are markets usually so lousy in the summer? Or so good in the winter? No one seems to know yet.

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Disclaimer: This is in no way an investment recommendation. This is purely my summary and analysis based on data from the internet and a few other analyses. Investing in the financial markets is risky and everyone should invest based on their own decisions. I am just an amateur sharing my opinions.

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