Friday, September 9, 2016

Rough Tides Ahead?

As we finish up this so far relatively calm shortened trading week I thought it'd be fun to bring up some history regarding the Dow Jones and volatility.

The 5 largest daily percentage losses in the Dow have all come over the next few months in October, November, and December. The largest point drop was the 22.6% drop during
the 1987 crash. Strangely 70% of the largest drops in history have all come in the fall.



RankDateCloseNet change% Change
11987-10-191,738.74−508.00−22.61
21929-10-28260.64−38.33−12.82
31899-12-1858.27−7.94−11.99
41929-10-29230.07−30.57−11.73
51929-11-06232.13−25.55−9.92
61932-08-1263.11−5.79−8.40
71907-03-1476.23−6.89−8.29
81987-10-261,793.93−156.83−8.04
92008-10-158,577.91−733.08−7.87
101933-07-2188.71−7.55−7.8


On the slip side the 4 out of 5 of the largest percentage daily gains have come during Autumn.  Although the 4th ranked gain on 9/21 depending on the year might land in summer or fall. Coincidentally 70% of the largest 10 percentages gains have landed during September, October, and November. I actually think that makes sense. Since large down days are often followed by large up days during volatile times. In fact if you look closely you'll see that's the case with the top 10.


RankDateCloseNet change% Change
11933-03-1562.18.2615.34
21931-10-0699.3412.8614.87
31929-10-30258.4728.412.34
41932-09-2175.167.6711.36
52008-10-139,387.61936.4211.08
62008-10-289,065.12889.3510.88
71987-10-212,027.85186.8410.15
81932-08-0358.225.069.52
91932-02-1178.66.89.47
101929-11-14217.2818.599.36


Seems the back half of the year is not a time to relax like it's summer cousin. Considering the lazy summer we had I wouldn't be surprised to see the market gyrate over the ensuing months. Especially with the election looming.








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