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    Wishing a Shanah Tovah to celebrants; stock markets often perform poorly during this festive period

    by VT Markets
    /
    Sep 22, 2025
    US stock market futures are down as Rosh Hashanah begins. Late September hasn’t been good for stocks historically, with an average decline of 1.1% over the last ten days since 1928. The time between Rosh Hashanah and Yom Kippur usually sees an average drop of 0.5% in the S&P 500. Yom Kippur ends at sunset on October 2. This year, the S&P 500 has mostly broken this pattern, even though current futures have fallen by 0.3%.

    Historically Weak Period for Stocks

    We’re entering a historically weak time for stocks, highlighted by the saying “Sell Rosh Hashanah, buy Yom Kippur.” Since 1928, the S&P 500 has often dropped over 1% in the last ten days of September. Following last week’s hawkish comments from the Federal Reserve, this seasonal trend feels even more significant. In this context, expected volatility is rising. The VIX has risen to over 17 this past week, a noticeable increase from summer lows near 13 back in July 2025. Traders might consider buying call options on the VIX, expecting it to spike towards 20 if this seasonal dip happens.

    Equity Strategies and Market Positioning

    On the equity side, more traders are seeking downside protection. The CBOE put/call ratio has recently reached 0.95, indicating traders are preparing for a market drop. We could consider buying near-term put options on major indices, aiming for expirations right after Yom Kippur ends on October 2 to take advantage of this weak period. For those who think any downturn will be small, selling out-of-the-money call spreads could be a good strategy. This approach allows us to earn premium, betting that the market will stay flat or dip slightly instead of making a strong rally before early October. The limited risk with a spread is appealing given the current uncertainty. Create your live VT Markets account and start trading now.

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