Waiting for Santa's Rally

Updated: 20 December, 2021 seen 15

For the past couple of weeks, I've been waiting for Santa's relief rally in the stock market, and especially hoping for it this week.

Tonight we arrived from Tbilisi to Riga and I hoped for a nice and calm session in the stock market, but nope it didn't happen and again I'm pushed out, facing possible margin calls. Looking to find additional funds to deposit to avoid margin calls in my brokerage account.

Lately, I've been troubled with too many open options trades. I'm holding short naked positions on ETFS like EWZ (Brazil), FXI (China), and stocks like INTC, SPCE. The total adds up.

I hope in 2022 I will finally learn how to manage my portfolio better.

A Santa Claus rally is a calendar effect that involves a rise in stock prices during the last 5 trading days in December and the first 2 trading days in the following January.

According to the 2019 Stock Trader's Almanac, the stock market has risen 1.3% on average during the 7 trading days in question since both 1950 and 1969. Over the 7 trading days in question, stock prices have historically risen 76% of the time, which is far more than the average performance over a 7-day period.

However, in the weeks prior to Christmas, stock prices have not gone up more than at other times of the year.

The Santa Claus rally was first recorded by Yale Hirsch in his Stock Trader's Almanac in 1972.

The Dow Jones Industrial Average has performed better in years following holiday seasons in which the Santa Claus rally does not materialize