Santa Claus is a friend of Polish investors

Santa Claus is a friend of stock market investors. Historical data shows that global stock markets are up 70% in December. cases, and December is usually responsible for ¼ of the annual growth of these markets. Mikołaj is particularly fond of the Polish stock exchange, which usually grows by 3% in December. – well above the average in other markets.

Investors "expect" St. Santa

The concept is widely known "Santa's Rally", which originally covered the last few days of the old year and the first days of the new year, when investors were observed to make better than average returns. This concept was quickly extended so that it now also applies to the time before Christmas. And due to the fact that the Christmas rush is starting earlier and earlier, we can safely use this term to cover the whole of December.

What about the statistics?

Santa Claus is very favorable to investors. Historical data shows that December is the best time of the year for them. Conducted by eToro an analysis of the 16 largest global equity markets shows that in December they were up 70 percent. cases, and this month is usually responsible for ¼ of the annual increase in the value of the stock market.

The average December "Santa Claus Rally" was 1,8 percent. However, there are significant differences between individual markets. It turns out that the highest rates of return were recorded in December in Poland and Hong Kong, on average 3 percent each. each year. This is more than in the UK, where the average December growth was 2,4%, Germany (1,4%) or in the USA (1,3%).

The broader seasonality is also very important. All sixteen of the markets surveyed perform significantly better in the six months from November to April than in the six months beginning in May. This is the traditional effect of the so-called "Sell in May and go away".

The December seasonality is due to investors positioning themselves for the next year ahead of the well-known upward "January effect". This year, the "Santa's Rally" started much earlier, with global markets already up 13% to date. above October lows. The outlook for 2023 seems to be better than the shocks we have been exposed to this year due to the war, inflation and rate hikes.

About the author

Pawel Majtkowski - analyst eToro on the Polish market, which shares its weekly commentary on the latest stock market information. Paweł is a recognized expert on financial markets with extensive experience as an analyst in financial institutions. He is also one of the most cited experts in the field of economy and financial markets in Poland. He graduated from law studies at the University of Warsaw. He is also the author of many publications in the field of investing, personal finance and economy.