Jul, 3 2025
Would you believe that Wednesdays might be cheaper than Fridays when it comes to buying stocks? People have been arguing about market timing for as long as there have been markets. Stories fly around: 'Mondays are unlucky,' 'Buy on Fridays before the weekend bump,' and the ever-present 'Nobody can time the market.' But if you had the chance to pick any day of the week to make your stock purchase, would it really matter? I've spent years in Melbourne sipping coffee and watching global markets open in the dead of night, and let me tell you—the day you pick might not make you rich overnight, but it can still make a difference worth your attention.
The History and Myth of the "Best Day" to Buy Stocks
There's this legendary idea called the "Monday Effect." For decades, old-school traders whispered that Mondays saw stock prices take a hit as bad news piled up over the weekend, making it the bargain day. Real research backs this up—at least, it did. If you check studies from the late 20th century, like the one by Frank Cross in 1973, you'll see evidence that Mondays, especially in the US, used to bring lower returns compared to other days. The logic was simple: bad news couldn’t be priced in until the weekend ended, so investors woke up on Monday with a bad taste in their mouths. That led to selling pressure, pushing prices down. For years, people relied on this pattern, making Monday a secret handshake among savvy investors.
But markets aren't static creatures. Once everyone gets wind of a pattern and tries to exploit it, the edge starts to fade. Fast forward to now—algorithms, 24/7 global coverage, instant news. The "Monday Effect"? It's a shadow of what it was. You'll still see a bias toward weaker Mondays, but the gap is barely noticeable. According to a 2022 analysis by S&P Dow Jones Indices, Monday's average returns on the S&P 500 were just a fraction lower than other days—nothing you could retire on. Other myths exist too, like the supposed "Santa Claus Rally" in December or the "Sell in May and go away" slogan. Some have truth baked in, but many are gifts to newsletter sellers, not investors.
Despite these old stories, you can't ignore psychological rhythms. Most traders are human. We dread Mondays, warm up by mid-week, and feel almost euphoric by Friday. This affects trading volume and sometimes even pricing. For example, Fridays often see positive closes in anticipation of a good weekend or market optimism. Does that mean you should always buy on Mondays? Maybe, but don't take it as gospel. With instant information transfer, markets now move on real events, not just on which day the calendar shows. If anything, the day matters less now than the nature and timing of the news itself.
One neat fact? The Australian market (ASX) sometimes gets pulled more by US and Asian movements than by its own daily mood swings. On Monday, the ASX actually digests what happened in the US over their Friday and our weekend—so you can get surprises that aren't just about Australian news. I’ve seen quite a few beginners get thrown off by big Monday gaps, thinking they were catching a pattern, only to realize it was all about New York or Shanghai.
Patterns and Insights: Does Market Timing Work?
Here's the unvarnished truth: if you’re thinking about day-to-day market timing, you're fighting an uphill battle. Tons of research, like the 2018 Morningstar Report, tells us that even professionals struggle to beat the market regularly by picking the right days. The market is a relentless mix of psychology, news, and, occasionally, blind luck. But, that doesn't mean all timing is useless. There are still some patterns—just not the ones from your Uncle’s stock-buying theory.
Weekly trends still pop up from time to time, especially around key announcements. For example, many Aussie companies file earnings on Wednesdays or Thursdays. You’ll often see bursts of trading—and big moves—around those days. Sometimes, these moments bring bargains, especially if the crowd panics on news that’s not really bad, or if there’s an overreaction. If you're following US stocks, the pattern is even more pronounced around Federal Reserve meetings (usually Wednesdays) or major economic reports. Some seasoned traders hang around on Tuesday nights (Aussie time) just to catch the post-announcement ripple effects.
This is where a sharp eye—not just a calendar—comes in handy. Instead of fixating on specific weekdays, try tracking the volume and volatility around key dates. Instead of asking, "Should I buy on a Tuesday or a Thursday?", look for when typical big moves happen in your target sector. Tech stocks, for example, can swing wildly after earnings releases. Mining shares might react to mid-week Chinese import data. Each stock has its rhythm if you study long enough.
Some traders still try to exploit what’s called "seasonality"—the times of year or month when stocks have historically done better. Did you know that the last few days of a month, and the first few of the next, often see positive moves? This is called the "turn-of-the-month effect." One theory is that fund managers rebalance their books at the end of the month, move cash around, and cause a flurry of buying. According to research by Andrew L. Ziobrowski in the early 2000s, buying at the very end of a month and selling a few days into the new one had higher returns over decades than just sitting tight all the time. Of course, once too many people catch on, these effects fade, but they never disappear completely.
Here’s a tip for those buying Australian blue chips: the market likes to start strong, then sometimes dips mid-week, then ends on a positive note before the weekend. If a stock you like has dipped by Wednesday afternoon for no real reason except mild selling, that's when you swoop in. I’ve made several buys on boring Wednesday afternoons, just before a run-up heading into Friday. And for those wondering, pre-market and after-market periods can be goldmines for patient, limit-order investors—sometimes you get a better price just outside normal hours due to thin trading volumes and nervous sellers.
Smarter Strategies for Buying Stocks
If you’re new to investing, you might be asking: Should I obsess over the "best day" to buy stocks or just get started? Here's what’s worked for experienced investors (and what research backs up): focus less on the perfect day, more on buying regularly and keeping costs low. The famous "dollar-cost averaging" trick means buying a fixed amount at regular intervals—weekly, fortnightly, or monthly—regardless of the day. That smooths out highs and lows over time, and takes the stress of timing off your plate. Vanguard, the world’s biggest fund manager, published data in 2023 showing that investors who used dollar-cost averaging outperformed most of those who tried to pick the lowest days, just because consistency wins over luck.
But if you want to squeeze out a little extra value, keep these tips in mind:
- Watch volume: Lower trading volumes (usually Mondays and Fridays) sometimes bring wider bid-ask spreads. If you’re buying less-liquid stocks, you might pay more, so consider mid-week—Tuesday or Wednesday—for small caps.
- Track market-moving events: Big announcements land mid-week for most major companies, especially in Australia and the US. If you see heavy selling on mild news, it can be a chance.
- Embrace patience: Sometimes, waiting for a boring, red day—not a big news day—pays off. Panic drops can be short-lived. This is where limit orders come in—you set your price and wait for the market to come to you.
- Ignore superstition: "Winning" days like Friday might just be self-fulfilling prophecies, but unless you see a real price dip, there’s no magic bullet.
- Check overseas trends: If the US market has tanked on Friday, Aussies might wake up Monday to bargains (or landmines). Always check what’s happened while you were sleeping.
Don’t get caught up staring at charts endlessly, trying to decipher the perfect entry point based on the day of the week. The biggest winners in the stock market aren't fortune-tellers—they're the folks who buy good stocks at reasonable prices and let them grow, week in and week out. If you want to geek out over patterns, use them as a tiebreaker, not your only edge.
At the end of the day, time in the market almost always beats timing the market. But if you want a slight nudge, aim for the middle of the week when everyone’s past the Monday blues and not rushing out the door for Friday drinks. If you really want to geek out with the data, track your buys for a year and see if your own pattern emerges—that’s when investing gets personal, and that little edge is yours alone.