An Example of Strong Single Stock Seasonality

Many individual stocks exhibits phases of seasonal strength. Being invested in these phases is therefore an especially promising strategy.

 

Danish drug company Novo Nordisk

 

Today I want to introduce you to a stock that tends to advance particularly strongly at this time of the year: Novo Nordisk. The Danish pharmaceutical group supplies a broad range of products and is a global market leader in diabetes drugs.

 

Novo Nordisk exhibits a brief, but very strong seasonal phase

Take a look at the seasonal chart of Novo Nordisk below. This is not a standard price chart showing prices moves over a specific time period. Rather, the seasonal chart depicts the average price pattern of Novo Nordisk in the course of a calendar year over the past 10 years.

 

Novo Nordisk, seasonal pattern over the past 10 years. The stock typically rallies particularly strongly in mid February

 

I have highlighted the especially strong seasonal phase from February 11 to February 22 in blue. In this time period Novo Nordisk displays a particularly strong seasonal advance.

 

A gain of 495.78 percent annualized!

Over the past 10 years Novo Nordisk rose in every single year in this phase. In other words, the pattern had a hit rate of 100 percent. The average gain achieved in these mere eight trading days amounted to 5.01 percent. This corresponds to an extremely strong annualized gain of 495.78 percent!

The following bar chart shows the pattern return for the time period February 11 to February 22 in every single year since 2010.

 

Novo Nordisk, percentage return of the seasonal rally between Feb. 11 and Feb. 22 in every year since 2010. The stock rallied in every year under review.

 

As this chart confirms, in the past ten years prices indeed rose over these eight trading days in every single year. The largest gain achieved in 2015 amounted to 11.46 percent!

In my opinion such large seasonal gains in such a short time period represent a phenomenal opportunity. The appeal of investing in particularly strong seasonal phases and thus significantly increasing the chance of generating extraordinary returns should be obvious.

 

Take advantage of single stock seasonality!

As you can see, individual stocks exhibit their very own seasonal patterns which often include very attractive phases of strength. On our web page www.app.seasonax.com or alternatively on the Seasonax app at Bloomberg or Thomson-Reuters Eikon, promising seasonal patterns of thousands of individual shares are waiting to be discovered!

 

Dimitri Speck specializes in pattern recognition and trading systems development. He is the founder of Seasonax, the company which created the Seasonax app for the Bloomberg and Thomson-Reuters systems. He also publishes the website www.SeasonalCharts.com, which features selected seasonal charts for interested investors free of charge. In his book The Gold Cartel (published by Palgrave Macmillan), Dimitri provides a unique perspective on the history of gold price manipulation, government intervention in markets and the vast credit excesses of recent decades. His ground-breaking work on intraday patterns in gold prices was inter alia used by financial supervisors to gather evidence on the manipulation of the now defunct gold and silver fix in London. His Stay-C commodities trading strategy won several awards in Europe; it was the best-performing quantitative commodities fund ever listed on a German exchange. You can find an introduction to the Seasonax app and in-depth information on what it can do here. Furthermore, here is a complementary page on the web-based Seasonax app, which costs less and offers slightly different functionality (note: subscriptions through Acting Man qualify for special discounts – for both the Bloomberg/Reuters and the web-based versions of the app. Details are available on request – simply send a note to info@acting-man.com with the header Seasonax!). PS: in the run-up to Christmas, very large special holiday discounts are available!

 

Charts by Seasonax

 

Chart & image captions (where indicated) by PT

 

 

 

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