Latest news with #MondayEffect
Yahoo
28-05-2025
- Business
- Yahoo
Don't Check Your Stock Portfolio on Mondays
If you've ever peeked at your investment portfolio on a Monday morning and felt your stomach drop, you're not alone. For You: Find Out: Mondays have a reputation for being volatile on Wall Street, and it's not just because people are groggy from the weekend. Financial experts agree that checking your portfolio on Monday can stir up unnecessary stress and, worse, lead to rash investment decisions. Here's why it's smarter to wait, and how long-term investors can use this insight to stay calm and committed. Unlike the markets, the news cycle doesn't take weekends off. From corporate earnings leaks to geopolitical events, information builds up over the weekend and is quickly digested by investors come Monday. The result? Market overreactions. 'Monday can typically be a chaotic one. With the markets closed over the weekend, the news continues to give out information that investors break down, and it can lead to swings on Monday,' explained Chad Gammon, CFP and owner of Custom Fit Financial. 'Checking your portfolio on a Monday is like stepping on the scale after a weekend; you probably won't like what you see,' added Andrew Latham, CFP with SuperMoney. 'But it's mostly bloat that disappears by midweek if you stick to your plan.' That makes Monday one of the worst days to judge your portfolio's true health. One or two red numbers might not mean your financial goals are in jeopardy. It may just mean that the market is reacting to the latest headlines. 'Mondays are known for market jitters, and there's even something called the Monday Effect, where stocks often dip or behave erratically at the start of the week, possibly due to weekend news or nerves, or companies releasing bad updates after markets close on Fridays,' said Nicole Carlon, CFP, CDFA, of WiseOak Wealth, LLC. 'Whatever the reason, checking your portfolio on a Monday can give you an unnecessarily negative picture,' she added. Be Aware: Frequent portfolio check-ins may seem responsible, but they can backfire, especially if you're doing it on a day like Monday, when emotions and volatility are high. 'Checking in frequently on your portfolio can lead to some emotional reactions that hurt you financially in the future with impulse decisions,' said Gammon. 'You should consider reviewing your investments on a monthly or quarterly basis at the most to help avoid impulse decisions.' 'I've seen people panic over a red Monday screen, only to watch things bounce back within a day or two,' added Carlon. 'If you're investing for the long haul, reacting to early-week swings can do more harm than good.' The key? Don't panic. The stock market has natural ups and downs, which are often exaggerated early in the week. Stick to your strategy instead of reacting to temporary turbulence. Interestingly, there's no one-size-fits-all when it comes to portfolio check-ins. Some investors actually benefit from seeing daily swings. 'This may sound counterintuitive, but some clients check their portfolios daily. This actually alleviates some of their fears, since they get comfortable with the day-to-day swings,' explained Jake Falcon, CRPC, founder and CEO of Falcon Wealth Advisors. 'If you only check it on Mondays, it can actually induce more fear.' But whether you check it frequently or on a structured schedule like quarterly reviews, the real danger comes from acting on emotion. 'We encourage clients to focus on their financial plan, not the headlines. Your portfolio is a tool to help you reach your goals,' said Falcon. 'Most importantly, we advise our clients to not let their emotions dictate their investment decisions. This is where having a trusted advisor can make all the difference.' Carlon added that it's important to check on your investments intentionally. 'Set time aside every few months to review your portfolio in the context of your long-term goals, not in response to a single rough morning. In the meantime, use Mondays for things like reviewing your budget or setting financial goals, not stress-scrolling your account.' Unless you thrive on stress, Mondays are probably the worst day to check your portfolio. Between weekend news reactions and emotional market swings, you're more likely to make impulsive decisions that derail your long-term goals. So what should you do instead? Develop a review habit that works for your mindset and stick to a sound investment plan. More From GOBankingRates Surprising Items People Are Stocking Up On Before Tariff Pains Hit: Is It Smart? The New Retirement Problem Boomers Are Facing This article originally appeared on Don't Check Your Stock Portfolio on Mondays
Yahoo
26-05-2025
- Business
- Yahoo
Theory Says Don't Sell Your Investments on Monday — Here's Why
Deciding when to buy or sell an investment is a tricky business because it's impossible to predict with certainty where its price will go in the future. But there are certain patterns that suggest some days are better to buy or sell than others. On Monday, for example, you might want to avoid selling investments — especially stocks. Find Out: Discover More: The reason has to do with the so-called 'Monday effect,' which is open to a couple of different interpretations. Here are more details on this theory and three reasons you may want to consider selling on a different day. One theory holds that stock prices on Monday tend to follow Friday's actions. It's based on early 1970s research from academic Frank Cross showing that Friday was often the best-performing day for the S&P 500, The Motley Fool reported. In about half of the cases, the index continued to rise the following Monday — and you might not want to sell a stock whose price is still moving higher. Another version of the Monday effect, cited by VectorVest, suggests that Friday is the best day to sell a stock because you can maximize your return before the weekend. On Monday, that return might be heading in the other direction, so it's not the ideal time to sell. Read Next: Not everyone subscribes to these theories. For those who do, here are three reasons you might not want to sell your investments on Monday. When the stock markets move higher on Friday, that momentum often pushes into Monday. Proponents of the Monday effect recommend not selling when prices are still on the rise. As The Motley Fool noted, companies often release bad news after the close on Friday so that it gets hidden away over the weekend, when the markets close. If that bad news causes prices to dip instead of rise early Monday, you should hold off selling until prices stabilize again. In bear markets, Mondays and Tuesdays tend to be the most volatile, which means stocks fall the most on these days, according to J.P. Morgan Wealth Management. When this happens, you're usually better off standing pat rather than selling or buying. More From GOBankingRates I'm a Retired Boomer: 6 Bills I Canceled This Year That Were a Waste of Money This article originally appeared on Theory Says Don't Sell Your Investments on Monday — Here's Why
