IN THE NAME OF ALLAH THE MOSR GRACIOUS THE MOST MER CIFUL
SEASONALITY
Seasonality first is the fluctuations of the cycle that occur regularly or less than quasi-regular during a certain time series, for example the holy month of Ramadan in which consumption increases among Arabs in general and Egyptians in particular, and consequently the prices of most commodities rise and this is called the seasonal month of Ramadan, offset in America by the rise in gasoline prices at the start of the season Summer holidays, of course, each has its own seasonal market, such as the markets for energy, bonds, commodities, etc. Even the economic statistics themselves found that they are seasonal, but without going into details we focus on stock markets and try as much as possible to summarize the huge amount of information I have, there is a study from 1970- 2005, they found that the best market periods are from 1 / 11-30 / 4, so the saying “SELL IN MAY AND BUYING BACK IN NOVEMEBER” became famous. Of course, there are other studies in which this study has been revoked, but let us focus on the months that are almost unanimous, in which there are about 5 distinct months, such as January This alone is his example, so that they think that it is the key month for the whole year. JAN EFFECT. Personally, I spoke about it at the beginning of the current year on 2/2/2020 and 2/3/2020 and the statistics that I did, which extended for 100 years, about the impact of January, whether on the month of February Air or the closing of December or the close of the same year, and I want to refer to this statistic at the following address: https: //stockcharts-home.blogspot.com /.../ 1985-2018-3112 ... In general, January is usually positive and I will not explain its reasons, but Its effect extends to February, during which the fluctuations are high, as well as the months of September and October, especially October, whose performance is often negative. As for November, it is often a positive month, and December is negative because of the sale of lost stocks and obtaining tax reductions, which explains why January is often positive. With the rush of investors to buy shares, which they sold at lower prices in January
A way to benefit from seasonality?
Certainly, when you know periods of strength in the market in which you work and periods of inactivity, you will take advantage of the periods of activity in it in your favor and try to maximize your earnings and in periods of inactivity, your capital can be rotated in other active markets or even other sectors characterized by strong activity in periods of inactivity, in which people can not appreciate the value of time In investing, time for big investors means TIME IS MONEY
Presidential session: PRESDENTIAL CYCLE
In fact, it is called the 40-month cycle, and it was customary to call it the four-year cycle, and with its occurrence coinciding with the American elections, it was called the presidential cycle, and since 1832, the American markets rose 577% during the last two years of the head cycle compared to 81% during the first two years, and it was found that the third year of S & P500 revenues were the largest Also, in the last two years of the presidency, the ruling party tends to reduce interest rates in order to ensure that it is elected for another period as well. It was found that the rest of the countries that do not hold elections every 4 years are affected by this cycle due to the strength of the US economy and its impact on the global economy as well as the US financial markets because of the link Positive correlation between the markets, so we have seen Trump throughout the past period in a dispute with the President of the US Federal Reserve because of the issue of the interest rate reduction.
Junk Bonds: JUNK BONDS
junk bonds are taken as an indication of the risk appetite of investors to invest in risky assets such as stocks, so that investors start to pick up the federal policy that he mentioned last May in buying corporate bonds with BB rating, which is the highest rating that bad bonds reach, meaning the lower the rating for this. Bonds, risk increases, in which BBB means, and then enter into classification C with grades and then D grades, but it is striking that the junk bond market is growing in a big way, and nearly until 2015, it reached 1.3 trillion dollars. It is striking that from May to September, the bad bond market was growing from a month ago. To the end, the month of August achieved the second largest record in issuance after June of $ 53 billion, and it is strange that Paul Corp., an aluminum packaging company, sold 1.3 billion of bad bonds for ten years with a yield of $ 2.875, which is the lowest return ever for these bonds, and despite that, the demand was for them. When we compare, for example, the day in which these bonds were sold, with a yield of 2.875%, which is the lowest return on American treasury bonds for ten years, it was 0.59%, even high-quality companies like Apple At the same time, bonds were issued with a yield of 1.22%, often the return of poor bonds would be two numbers between 11% -14%. Ask Egypt and the countries that resemble the last issuance of their bonds. The return was almost as if it was not less than 6%
SEASONALITY & PRESDENTIAL CYCLE & JUNK BONDS SEASONALITY & PRESDENTIAL CYCLE & JUNK BONDS
SEASONALITY
Seasonality first is the fluctuation of the cycle that occurs regularly or less almost regularly during a specific time series, for example
Junk Bonds: JUNK BONDS
Bad bonds are taken as an indication of the risk appetite of investors to invest in risky assets such as stocks, so that investors start to pick up the federal policy that he mentioned last May in buying corporate bonds with BB rating, which is the highest rating that bad bonds reach, meaning the lower the rating for this. Bonds, risk increases, in which BBB means, and then enter into classification C with grades and then D grades, but it is striking that the junk bond market is growing in a big way, and nearly until 2015, it reached 1.3 trillion dollars. It is striking that from May to September, the bad bond market was growing from a month ago. To the end, the month of August achieved the second largest record in issuance after June of $ 53 billion, and it is strange that Paul Corp., an aluminum packaging company, sold 1.3 billion of bad bonds for ten years with a yield of $ 2.875, which is the lowest return ever for these bonds, and despite that, the demand was for them. When we compare, for example, the day in which these bonds were sold, with a yield of 2.875%, which is the lowest return on American treasury bonds for ten years, it was 0.59%, even high-quality companies like Apple At the same time, bonds were issued with a yield of 1.22%, often the return of poor bonds would be two numbers between 11% -14%. Ask Egypt and the countries that resemble the last issuance of their bonds. The return was almost as if it was not less than 6%
In sum, in this matter, the appetite for risk is already present among the investors, and it is likely that the markets are on a date with new peaks, perhaps beginning from the beginning of the year, and as long as the federation's head is present and print, Zaki, his ability, the risk appetite must be present. From the American elections, but the real fear and anxiety that is not accounted for until this moment is the second closure of the major economies in the event of the development of Covid-19 cases, may God bless us and you
