Which Days of the Week Yield the Best and Worst Stock Market Returns? 98 Years of History Provide a Clear Answer.
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Which Days of the Week Yield the Best and Worst Stock Market Returns? 98 Years of History Provide a Clear Answer.
08 mins
Over the last century, the stock market has been the premier wealth creator. Despite nominal gains from bonds, commodities, and real estate, the average annual return of the ageless Dow Jones Industrial Average(DJINDICES: ^DJI), broad-based S&P 500(SNPINDEX: ^GSPC), and technology-dependent Nasdaq Composite(NASDAQINDEX: ^IXIC) tops all other asset classes.
But this doesn’t mean Wall Street’s major stock indexes move up in a straight line or deliver returns as expected. Aggregating 98 years of S&P 500 trading history shows that select trading days have been kinder to investors than others.
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Before diving in, a quick word about historical precedent: it doesn’t guarantee what’s to come. Although history does have a tendency to rhyme on Wall Street, no data point or historical event can ever guarantee short-term directional moves in the stock market.
With the above being said, more than 24,300 trading days for the S&P 500 since 1928 offer a pretty comprehensive look at which days of the week investors are likeliest to see green or red arrows.
The data aggregation, courtesy of Carson Investment Research and FactSet, was published on social media platform X (formerly Twitter) by Carson Group’s Chief Market Strategist, Ryan Detrick. Though Detrick’s post was to highlight the performance of the S&P 500 on Friday the 13th, it also showed the average return for each day of the week over the last 98 years.
If you want red arrows, look no further than Monday. More than 51% of all trading Mondays have finished lower since 1928, with an average return of -0.07%. I’d venture a guess that two trade-free days over the weekend allow uncertainties to mount on Wall Street, thereby dragging down the S&P 500 on Mondays.
On the other hand, Wednesday has historically provided investors with the highest average return, 0.06%. Many of Wall Street’s most influential companies tend to report their operating results toward the middle of the week — and most public companies leapfrog consensus sales and profit forecasts. The long-term outperformance of Wednesdays likely has to do with earnings season.
However, Friday offers investors the highest probability of a positive return. Although average gains are higher on Wednesday, Fridays have ended green 54.6% of the time over the last 98 years.
Image source: Getty Images.
While it’s fun to examine the minutiae of individual trading days, investors need to recognize that time, not the individual day of the week, is the key variable that determines success.
Analysts at Crestmont Research recently updated a published data set that examines the rolling 20-year total returns, including dividends, of the S&P 500 dating back to the start of the 20th century. This exercise yielded 107 rolling 20-year time frames (1900-1919, 1901-1920, and so on, through 2006-2025).
The prime takeaway from Crestmont’s data set is that all 107 rolling 20-year periods generated a positive annualized total return. Hypothetically, if an investor had purchased an S&P 500-tracking index at any point from 1900 to 2006 and simply held it for 20 years, their investment would have grown every time.
At the same time, missing just a few of the stock market’s best daily gains can drastically reduce long-term returns. Staying the course and leaning on time as an ally has historically been the formula for meaningful wealth creation.
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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends FactSet Research Systems. The Motley Fool has a disclosure policy.
