Seasonality

I hope everyone out there in Readerland had a fine Thanksgiving. I certainly did, visiting family in California. With a real highlight being a drive up Highway One. In my view truly the most beautiful drive in America.

And now on to the subject at hand. There is a great deal of seasonality in this business. Hugely busy in the new year as everyone begins afresh. Then earnings season, usually followed by summer doldrums. More earnings, sometimes with events around October. Then, when December comes there is very little to do. Every professional trader and trading house is just interested in getting their books in order. Locking in profits, taking what losses they need to getting their tax situation in order, etc. Almost no one is willing to take on new risk. Everyone waits for January when the guns are reloaded and the books are clear.

What that means for you is much the same. The market will be thin and illiquid until January. There is little reason to take on new risks or open new positions. As I said back in March, "when there is nothing to do, do nothing". The worst mistake you can make is to trade a thin market out of boredom or some theoretical need to trade.

What that means for me and this column is there will very likely not be a new column every day until January. I will post year end summary and review unless something happens in the market that truly needs comment.

This does not mean, however, that I am unavailable to my students, mentees, or even casual readers. I will happily answer any and all questions you may have. It may seem like heresy, but in the holiday month there is actually something more important than money or the market

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Markets

Originally posted here...

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