Ask Colin

Is there any substance to the recent seminar topic: 'What you must know about Mondays and Fridays'?

There has been some serious statistical work done on whether the market tends to be up or down on certain days of the week. Personally, I am sceptical of it for two reasons. Firstly, if you torture the numbers long enough, they will confess to anything. You can always find relationships on average or on a defined probability. Secondly, we should ask how useful it is. If you are a large-scale portfolio investor buying and selling all the time, it could be handy to know. However, for those only buying and selling one stock, it might not be much help to know that the market is up 60% of the time on a given day, but your stock was not up on a given day (one of the 60% or one of the 40%).

I prefer to trade off the individual stock chart. It I have a signal I act on it, regardless of the day.