Market rises during month end…really?

POSTED BY Nitin S ON June 29, 2012 7:12 pm COMMENTS (3)

Hi

I have a wierd observation and it has happened several times. I don’t have any facts to support this but I have realized this numerous times. During most of the month end’s ( 25th to 31st) market mostly rises and since we mostly(assuming) have SIP’s around 1st-to-5th of every month get less units as markets are on upside.

This month(Jun-12) also it happened that market rose by 450points and today is 29th-Jun. I also know that it’s purely coincidental and picture is much broader than my narrow observation. I read why markets jumped today and read factors behind it (global sentiment, Finance minister’s annocement, jump in stock rating by Morgan stanley etc)

I just wanted to vent my frustration nothing else 🙂 ? But has anybody had similar observation?
I know there are no perfect dates for SIP’s but is it going to be any better if dates are spread out during month?

3 replies on this article “Market rises during month end…really?”

  1. BanyanFA says:

    Nitin,
    I can appreciate your concern, however I shall term them as short term fluctuations and F&O markets are partly to be blamed. Why don’t you split your SIP trigger dates throughout the month, e.g. 5, 10, 20, 25 ?
    This would serve multiple purposes –
    1. It would provide you opportunity to capture market movements throughout the month,
    2. In case on a particular date of a month you don’t have funds in your bank account, it would prevent all SIPs to get bounced on a same date.

    What would be your opinion on my thought process ?

    Regards
    BanyanFA

  2. Dear Nitin, few months back an opposite query was posted (I’m not sure on this forum or other place). Market get tanked near month end. The same logic was given at that time – F & O expiry.

    So what’s the final call? please do not get obsessed with market level & keep investing. If you are investing for next 10-15-20Y, does this 300 or 500 point rise ‘ll effect much over this long period?

    Thanks

    Ashal

  3. Sachin says:

    yes, I too observed this and I feel possible reason for this is F&O expiry week and you could see some unusual ups and downs bcos of expiry.

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