What to Watch in Equities Markets as the Year Winds Down

It’s true that as the year winds down the markets see overall less trading volume. Market holidays and family vacations ensure things are quieter. But days off with the family and market closures don’t necessarily equate to a lack of significant events as we head into the end of the year.

December 20 was “quad witch” day as well as a major day for index rebalances. On that day, Lime Trading hit a trading volume record, processing nearly 57 million new orders, and traded 115 million shares in the last 15 minutes leading up to the closing bell—63% of which, 73 million shares, traded in the last 60 seconds of the trading day.

In addition, December 31 is both the end of Q4 and the last day of the year. Year-end/end-of-quarter falling on the same day is typically when fund managers make big final adjustments for portfolio positions and tax considerations. It’s also an election year, a time when markets typically see positive returns in the latter half of December.

In short, a lot can and does happen in December. As Johan Sandblom, President and Head of Business Development for Lime Trading puts it: “It is a misconception that there is nothing going on in the markets in December.”

For more, check out the December edition of Execution Matters from Trader’s Magazine.

Interested in learning about how Lime Trading can support your low latency US equities and options trading strategies? We’d love to hear from you. Contact sales@lime.co or call us at 646-558-3232.