St. Patrick’s Day Trading Strategy

St. Patrick’s Day Trading Strategy – Green Day for Stocks? Backtest, Performance

St. Patrick’s Day is an important day for Catholics. Is the day just as green for stocks as for those celebrating?

St. Patrick’s Day is one of the best days of the year for stocks, but that is thanks to the performance over the last 30 years.

Let’s find out why we celebrate St. Patrick’s Day and how stocks have performed on that particular day (we backtest).

Key Takeaways:

  1. St. Patrick’s Day shows a positive impact on stock market performance, especially notable over the last 30 years.
  2. Trading strategy: Buy before St. Patrick’s Day and sell on the 17th or the next trading day, yielding an average gain of 0.59% since 1993.
  3. Historical data from 1960 reveals a win rate of 67% for this strategy with the S&P 500 index.

When is St. Patrick’s Day?

St. Patrick’s Day is on the 17th of March.

What is St. Patricks Day?

St. Patrick’s Day originated as a religious holiday in the 17th century to commemorate the death of Saint Patrick, who was said to have brought Christianity to Ireland. Over time, it became a celebration of Irish culture and heritage and is now a popular holiday around the world, especially in the United States.

The day is celebrated with parades, parties, wearing green, and drinking beer or Irish whiskey. The color green is associated with St. Patrick’s Day because it is the color of the shamrock, which is said to have been used by St. Patrick to explain the concept of the Holy Trinity to the Irish people.

In Ireland, St. Patrick’s Day is a public holiday and is celebrated with parades and other festivities. However, it is a more low-key affair than it is in the United States, where it is often associated with drinking and partying.

Overall, St. Patrick’s Day is a day to celebrate Irish culture, heritage, and the legacy of Saint Patrick, who played an important role in Irish history and religion.

St. Patrick’s Day trading rules

We make the following trading rules to backtest St. Patrick’s Day:

  • If today is March and the trading is the last before St. Patricks Day, we buy.
  • We sell at the close of the following trading day (the 17th or the next trading day).

If St. Patrick’s Day is on a non-trading day, we buy at the close of the nearest trading day and exit on the 17th or the next trading day.

St. Patrick’s Day Trading backtest and performance for stocks (S&P 500)

Let’s apply the trading rules above to backtest S&P 500. We use the cash index back to 1960, and we get the following equity curve:

St Patricks day and the stock market
St Patricks day and the stock market

The average per trade is 0.21%, and the win rate is 56%. However, all the gains have come since the early 1990s.

If we backtest on SPY, the ETF treat tracks S&P 500 and was incepted in 1993, we get the following equity curve:

Is St Patricks Day a green day for stocks
Is St Patricks Day a green day for stocks

The average gain is 0.59%, and the win rate is 67%.

List of trading strategies

We have written over 1200 articles on this blog since we started in 2012. Many articles contain specific trading rules that can be backtested for profitability and performance metrics.

The trading rules are compiled into a package, which you can purchase all of (recommended) or just a few of your choice. The compilation has hundreds of trading ideas. The code for St. Patrick’s Day is included.

The strategies are taken from our landing page, which contains different types of trading strategies.

The strategies also come with logic in plain English (plain English is for Python trading and backtesting).

FAQ:

Is St. Patrick’s Day considered a good day for stocks?

Yes, over the last 30 years, St. Patrick’s Day has been one of the best days for stocks. St. Patrick’s Day celebration is linked to positive stock performance, as demonstrated through historical backtesting. St. Patrick’s Day is important for Catholics as it originated to commemorate the death of Saint Patrick, who is credited with bringing Christianity to Ireland.

What are the trading rules for St. Patrick’s Day backtesting?

The trading rules for St. Patrick’s Day backtesting involve buying at the close on the last trading day before St- Patrick’s Day and sell at the close on March 17 or the following trading day.

What is the average return per trade in the St. Patrick’s Day backtest?

The average return per trade in the St. Patrick’s Day backtest is 0.21%, but it is significantly higher from 1993 (0.59%).

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