Tramondo Investment Partners AG – Unter Altstadt 10 – Postfach CH-6302 Zug

Why we like seasonality studies

The greatest trader of all times, Jesse Livermore, already knew that the majority of capital markets are determined by psychological factors.

“There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again, and again, and again. This is because human nature does not change.

All through time, people have basically acted the same way in the market as a result of greed, fear, ignorance, and hope. This is why the numerical formations and patterns recur on a constant basis.”

This finding serves as an explanation for a market anomaly in the run-up to important holidays. Analogous to the much better-known Christmas rally, equity markets also tend to gain strength in the week before Easter and, therefore, during April. The seasonal tailwind can be explained by the good mood due to the holidays, which in turn is reflected in rising stock market prices.

We expect a choppy end to spring and a volatile start to summer, but we would not dare to underestimate the strong month of April, which produced the highest average monthly returns for the S&P 500 in the last 30 years.

At Tramondo, we like seasonality studies as they can be helpful in determining the short-term risk/reward of the broader market.

Chart 1: Seasonality
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About Tramondo

Tramondo Investment Partners AG is a bank-independent Swiss asset manager based in Zug and licensed by the Swiss Financial Market Supervisory Authority (FINMA) to act as an asset manager of collective investment schemes. The firm is a signatory of the UN’s Principles for Responsible Investment (PRI).


Tramondo Investment Partners AG

Unter Altstadt 10
Postfach CH-6302 Zug

+41 41 710 76 76

© 2022, Tramondo Investment Partners AG. All rights reserved.

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