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  1. ETFs to Play the Thanksgiving Rally
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ETFs to Play the Thanksgiving Rally

Stoyan BojinovNov 25, 2015
2015-11-25

Anemic volumes and muted trading activity generally are the two things that first come to mind when investors are asked about the market’s behavior during the week of Thanksgiving. Few would guess correctly that this holiday week has an undeniably bullish bias when considering historical market returns.

Low trading volumes around the holiday shouldn’t come as much of a surprise; after all, this is a shortened trading week, with Friday being a half-day on Wall Street. What is surprising is the overwhelmingly bullish nature of this week amid an otherwise “quiet” period in the markets.

See also Black Friday Shines Spotlight on Retail ETFs.

S&P 500 Performance During Thanksgiving Week

Consider the following research from Schaeffer’s about how the broad market, as represented by the S&P 500 Index, has performed during Thanksgiving week.


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Thanksgiving WeekAll Weeks
No. of Returns502655
Average Return0.63%0.14%
Median Return0.66%0.26%
Percent Positive66%56%
Avg. Positive1.58%1.58%
Avg. Negative-1.21%-1.67%

Key takeaways:

  • The average return during Thanksgiving week has been 0.63% vs. the average weekly return of 0.14%.
  • This holiday week has seen positive returns two-thirds of the time, with the average positive return being 1.58% vs. the average return of negative 1.21%.

It’s clear Thanksgiving week historically has favored the bulls more than the bears; and while this may be just an arbitrary fact to most investors, it’s a useful point of reference for many nimble traders looking to capitalize on short-term opportunities.

Broad Market ETFs to Play the Thanksgiving Rally

Investors looking to play the broad market during Thanksgiving may opt for one of three ETFs linked to the S&P 500 Index.

Alternatively, investors can “fine-tune” their exposures to the S&P 500 in a number of ways. For instance:

  • S&P 500 High Beta Portfolio (SPHB B-): This ETF is invested in only 100 of the S&P 500 stocks, and specifically those with highest beta; as such, SPHB can be expected to outperform the broad-based SPY whenever investors are in “risk on” moods.
  • S&P Equal Weight ETF (RSP B+): This ETF is invested in all 500 stocks from the parent index, but it affords equal weight to each security; as such, RSP can, at times, also be expected to outperform the broad market.

Other Ways to Play: Stock-Heavy ETFs

Single stocks also are prone to big moves during Thanksgiving week, according to Schaeffer’s. An investor may wish to opt for a fund that features meaningful exposure to any of the stocks listed below:

TickerCompany NameAverage ReturnMedian ReturnPercent Positive
JWNNORDSTROM6.43%2.52%90%
SCSSSELECT COMFORT6.26%1.77%90%
AAPLAPPLE4.71%4.91%90%
TIFTIFFANY2.62%3.00%90%
ASNAASCENA2.62%2.22%90%
CNCCENTENE2.12%2.15%90%
NKENIKE2.08%1.49%90%
KNDIKANDI TECHNOLOGIES4.31%3.50%88%
SKXSKECHERS5.69%3.40%80%
WSMWILLIAMS SONOMA5.69%2.60%80%
SBACSBA COMMUNICATIONS5.41%1.48%80%
HOTSTARWOOD HOTELS4.77%2.85%80%
MUMICRON TECH4.68%3.07%80%
CBGCBRE GROUP4.41%2.49%80%
CRUSCIRRUS4.25%3.62%80%
AEOAMERICAN EAGLE OUTFITTERS4.23%2.35%80%
DISHDISH NETWORK4.17%2.53%80%
EXPEEXPEDIA4.14%2.75%80%
DLTRDOLLAR TREE3.84%1.91%80%
MWMEN'S WEARHOUSE3.58%1.89%80%
LBL BRANDS3.35%2.26%80%
NWLNEWELL RUBBERMAID3.23%0.75%80%
AMZNAMAZON.COM3.21%2.70%80%
SLWSILVER WHEATON3.20%2.37%80%
ALKALASKA AIR GROUP3.18%1.19%80%
TGTTARGET3.06%0.76%80%
SWKSSKYWORKS SOLUTIONS2.97%4.03%80%
GOOGLALPHABET2.95%2.20%80%
TERTERADYNE2.83%2.95%80%

Keeping the stocks listed above in mind, some ETFs that warrant closer looks are:

  • (IYW A) is the AAPL -heaviest ETF, currently allocating around 19% of total assets to tech giant Apple.
  • (RWV B-) is the NKE -heaviest ETF, currently allocating around 7% of total assets to apparel king Nike.
  • (PBS C+) is the DISH -heaviest ETF, currently allocating around 5% of total assets to media provider Dish Network.
  • (PEJ A-) is the EXPE -heaviest ETF, currently allocating around 5% of total assets to online travel company Expedia.
  • (RTH A-) is the AMZN -heaviest ETF, currently allocating around 15% of total assets to online retail juggernaut Amazon.com.

To see all the ETFs that may have exposure to any of the stocks listed above, use the free ETFdb Stock Exposure tool – just search for the stock ticker and you’ll see which ETFs hold it, and how much.

The Bottom Line

No matter which approach you choose this Thanksgiving week, be it broad-based or stock-heavy, remember to practice disciplined profit-taking and utilize stop-loss orders, especially if you’re trading leveraged ETFs.

Follow me @SBojinov

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