The end of October can be a very strong time for global stocks and the DAX is certainly one index that benefits from this pattern. For whatever reason, fund inflows tend to be large around this time of the year. As a result, global indices tend to disproportionately rise during the winter months over the summer months. Take a look at Germany’s strong seasonal pattern to illustrate the point.
Over the last 25 years, the DAX has risen 21 times between October 24 and December 31. The average gain has been + 6.46%. The largest gain was +26.88% in 1999 and the largest loss was -7.54%.
Major Trade Risks: The main risk to this trade is on risk-off trading on any further news of slowing growth for Germany.