Strategy

How to profit from seasonality

Seasonax Capital has developed a strategy that captures seasonal trends in specific stocks and profits from their recurring nature over the course of the entire calendar year.

What is seasonality?

Seasonalities are regular and predictable patterns that recur every calendar year. Every industry exhibits unique seasonal trends, based on solid fundamental drivers that we are able to benefit from.

The best-known seasonal drivers include harvest periods, the timing of interest payments, the weather, investor sentiment at certain times of the year, as well as traditional patterns, such as the year-end rally in the stock market.

Seasonal strategies generate large gains based on statistical information; emotions play no role. After many years of intensive research, Seasonax Capital has developed a strategy that captures seasonal trends in specific stocks and profits from their recurring nature over the course of the entire calendar year.

Seasonal strategies generate large gains based on statistical information; emotions play no role.

The challenge

In order to benefit from seasonal patterns in the course of an entire year, a sufficient number of statistically profitable investment opportunities has to present itself at any given time. The most widely known seasonal trends occur only over a limited number of time periods in the course of a year.

In order to broaden the number of investable signals to the degree needed to be able to invest at all times, it is necessary to evaluate a large amount of historical data on every single stock and create algorithms to identify seasonal patterns.

Novo Nordisk, Seasonal Trend over the last 15 years.

Single stock exhibits distinct seasonal trends.

Source: Seasonax

Adidas, Seasonal Average over the last 15 years.

By shifting funds between different stock based on the timing of their strongest seasonal trends, it is possible to generate large cumulative gains

Source: Seasonax

Strategic Approach

Individual stocks exhibit distinct seasonal patterns, either due to internal business reasons, or due to a variety of external factors which affect their prices.

By screening different stock indices, we are able to identify and evaluate these single stock patterns. This enables us to switch from one stock to the next, exploiting the timing of the respective favorable seasonal trends and reap the benefits from the associated outperformance.

Focusing on the strongest seasonal periods in specific stocks in the course of the year will result in compounding profits.

Visualization of rolling from one stock to the next. This method will tend to compound returns in the course of the year.

Source: Seasonax

The combination of seasonal pattern insights and fully developed products enables us to optimize portfolios by applying precise market timing based on robust statistical data.

Funds

We have implemented our strategy into various products: