Many investors may try their luck at timing the market, but doing so can be risky. Instead, investing consistently throughout the year may yield greater long-term returns.
Ideally, investors should buy stocks during a regular stock trading session (typically running from 9:30 a.m. to 4 p.m. EST).
Day of the Week
Stock markets (also called stock exchanges) are marketplaces where individuals buy and sell shares of companies. If you’re in the market to purchase stocks, Monday may be your ideal purchase day as prices typically increase after returning from vacation; Friday tends to be best when it comes to selling, giving buyers time to grab bargains before prices dip again on Monday.
Dan Casey of Bridgeriver Advisors in Bloomfield Hills, Michigan suggests the ideal time for trading is just before market close, when inexperienced traders take last-minute trades based on news trends and price movements. This window typically sees major price movement.
Financial advisors typically recommend investing consistently rather than waiting for specific moments to buy or sell stocks, since trading stocks is risky and market fluctuations cannot always be predicted with accuracy. With tools and data that monitor daily fluctuations and sentiment, traders may attempt to predict when it’s best to purchase or sell.
Month of the Year
Contrary to popular beliefs, investing consistently over time should always take precedence over short-term trades like “selling in May and going away.” In fact, finding strong fundamental stocks may even have been discounted temporarily during market corrections or bear markets – investing consistently over time should always remain key regardless of which month or quarter your investments take place in.
Some investors look out for monthly trends like the January Effect or Santa Claus Rally that can present opportunities. Others prefer investing during the weeks leading up to year’s end when some may sell stocks to lock in gains for tax reasons.
September is typically a difficult month for stocks, as investors make adjustments to close out the third quarter. But doing the appropriate research and investing with confidence should make no difference: September remains an excellent month to identify, evaluate and select quality stocks as part of a long-term strategy plan.
While market trends and statistical data may indicate that certain days may be better for stock purchases than others, the reality can be much more nuanced – this is particularly true at specific times during each day and week when prices can be affected by multiple variables.
Typically, the best time of day to purchase stocks is immediately following market opening, when any major news events that have taken place either over the weekend or since market close are likely reflected in share prices first thing in the morning.
However, it is always essential to remember that when investing in shares it is key to consider whether they are undervalued by the market and offer opportunities for long-term investment growth. With proper research you can make an educated decision whether or not to purchase any particular stock at any point throughout the year or day.
When is the right time to purchase stocks? That depends on your investing goals and time horizon, rather than on market fluctuations on any particular day. But here are some general guidelines you can follow when looking for opportunities in stocks to purchase and sell.
For instance, if you want to buy shares at a low price, it might be beneficial to do it after trading has settled in the morning hours after lunchtime has concluded. At this time of day, markets tend to be less volatile and any news that might cause price changes should have passed by then.
Selling stocks near month-end is also beneficial, as portfolio managers tend to “dress up” their portfolios by purchasing more of those stocks that have performed particularly well over time, driving prices even higher near month-end.