Historical test result
Pre-holiday rally: gone after 2020.
My test of buying 7 stock indices into the day before holidays lost about 3.6 % a year in 2021-2023. You read that number as money lost on your account each year on average in those years, beside your firm's published loss limit.
What does this rule assume?
The rule builds on one simple claim about the calendar. Proponents of this rule say stocks rise before holidays. They point to the day before a holiday as a time when prices often move up. You can read that claim in plain words. It says the calendar alone tells you when to look. The test checks only that idea across past years. You save time when you write the claim down before you look at any numbers. You do not need to guess why the claim might work. You only need to see if past years moved that way.
What did the past years show?
Buying 7 stock indices into the day before holidays lost 3.6 % a year in 2021-2023, with a 30.3 % historical peak-to-trough decline in the full 2017-2023 run. The yearly loss covers only 2021-2023. The 30.3 % historical peak-to-trough drawdown covers the full 2017-2023 run across 7 stock indices at 2x gross positions. Those are three different measures for three different questions. You read the yearly loss as money lost on your account per year on average in those later years. Annualized return means how much money you lose on your account in one year on average. You read the decline as the largest fall from a past high to a later low in the full run. Peak-to-trough drawdown means that largest fall. Daily equity loss means how far equity falls in one day. Equity means your account value including open trades. The 30.3 % figure is historical peak-to-trough decline, not a firm-rule simulation and not a one-day loss. In this run firm-specific daily loss including open trades was not tested. Firm-specific overall loss-limit breaches were not tested.
Why does the split across years matter?
You learn more when you place the later years next to the full run. The later years show a yearly loss while the full run shows a large peak-to-trough decline. Those two views answer two different questions about the past. One view asks how each year moved on average in 2021-2023. The other view asks how far the line fell from a past high to a later low in 2017-2023. You miss that difference when you look at one number alone. You see it fast when you keep the yearly view apart from the peak-to-trough view. That habit helps you read any past test with more care. You can keep that split in mind for any calendar idea. You look at yearly moves first and then at the full fall. You get a calmer view when both lines stay in sight.
How do I read this result?
I read this holiday rule as a past pattern that weakened after 2020, so I leave it outside my own list. You can use the same split view when you look at other calendar claims. You keep the yearly move apart from the peak-to-trough fall. You ask if both views stayed steady across different times. That keeps your reading close to what the past years actually show. You stay close to the past data when you read both views side by side.
How can you check your own report?
Equity means your account value including open trades. Open your report and check your daily equity loss separately from your overall peak-to-trough decline. You find the daily move first and you write it down. You then find the largest fall from a past high to a later low and you write that down apart. You keep those two lines apart on your page. You finish this split view in five minutes with a clear picture of past years. You keep the page for your next look at past tests.
What should you remember?
These are historical test results, not a live account.
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