The Daylight Saving Anomaly

Category: Market News

25-03-2011

It may sound far stretched, but it is possible to make money from stock markets around the time of daylight changes. In the paper "Losing Sleep in the Market: The Daylight Saving Anomaly" by Kamstra, Kramer and Levi (2000), the stock market was found to produce larger falls the day after the daylight saving weekend than other weekends of the year. Their study found that between 1967 and 1998 in the US the mean negative return on the first trading day following spring daylight saving weekends (in March) is between 2 to 5 times greater than that following an ordinary weekend.

Please read for further details. Stock market speculators would be wise not to sleep on this one. Sell the market short at close of business on the Friday (via selling a FTSE 100 CFD or Future at £10 a point) and be ready to close the position at an opportune time on the Monday.

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