Trading Seasonality In Construction And Building Products Stocks

Seasonality works!

If you bought Sterne Agee’s mini basket of stocks in the construction material and building product business in the fall and cashed in by April following, you would be outperforming a similar investment in the S&P 500 by over 20%.

“Analysis of 15 years of trading data, over a variety of holding periods, supports our heretofore strongly held yet unproven idea that the fall is the best time to invest in construction materials and building products stocks,” say Stern Agee analysts Todd Vencil and Kevin Bennett in their September 29 research note on the construction materials industry.

Trading seasonality: Analysis by buy month and holding period

The stocks in the basket [A. O. Smith Corp (NYSE:AOS), Cemex SAB de CV (ADR)...