Tax Loss Selling - Footnote

Earlier in the year we reviewed weekly returns for the S&P/ASX Small Industrials Accumulation Index between January 2013 and January 2018. In the context of the previous blog entry, Tax Loss Selling, we went back to take a second look at that analysis (when we originally did these numbers, we were looking for any sign of the "January Effect" - it is often said that small caps generate their excess return for the calendar year in that one month but we don't see convincing evidence that this holds on the ASX).

This data shows the first week of June as typically the worst of the calendar year over the past five years and subsequent weeks in June also being lackluster.

Consistent with the chart from Wilsons in the previous blog entry, July in contrast has typically started off strongly and continued to power on.

These aren't projections - history may rhyme but doesn't precisely repeat.

Figure 1: Average performance of S&P/ASX Small Industrials Accumulation Index each week in each month for five years to January 2018.

source: Iress, Equitable Investors

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