In his daily note, everyone’s favorite veteran floor trader, UBS’ Art Cashin, reprises the history of Friday the 13th in the markets, and finds that it is far less scarier than some may believe, and in fact has a mild upward bias as it is up 55% to 60% of the time. There are, however, accidents, and on Friday, October 13, 1989, the attempted LBO of UAL collapsed and the Dow plunged 190 points, equal to 860 points today.
From The Feb 13 edition of Cashin’s Comments
Triskaidekaphobia (A Reprise) – It’s Friday the 13th and all of the negative myths surrounding it pop up. Friday the 13th actually has a mild upward bias in stock market history. It’s up 55% to 60% of the time.
Those numbers get stood on their head if Friday the 13th falls in the month of November. In November, Friday the 13th has a 70% negative bias, falling a little under 1%.
We think the overall negative myth may be based on a novel published back around 1910. It told of a plot by an evil stock trader (ain’t they all) to crash the market on Friday the 13th.
Prior to 1988, floor brokers used to have fun with the myth by declaring Friday the 13th “Hat Day”. Brokers would don silly and bizarre headgear pretending to ward off evil spirits.
It was colorful and a bit of fun. But, shortly after the 1987 crash, we had the biggest and maybe wildest “Hat Day” ever. Inspired by a sense of post-crash survival, it featured a parade on the floor and best in class awards.
Unfortunately, there was a newspaper “stringer” on the floor. He was doing an interview with a specialist who had gone out of business in the crash by making “too good a market”. The stringer would later sell a piece to the papers called “The Fat Cats In The Hats”. It was a caustic misrepresentation of Hat Day. We have not had one since.
Without the lucky charm of “Hat Day”, there were occasional problems. On Friday, October 13, 1989, the attempted leveraged buyout of UAL collapsed and the Dow plunged 190 points (equal to 860 points today).
By a numerical oddity, the 13th of the month falls on a Friday more than any other day. In the last 400 years, we have had 690 Friday the Thirteenths.
One last note on Friday the 13th. Triskaidekaphobia is actually fear of the number 13. Fear of Friday the 13th is actually Friggatriskaidekaphobia but that sounds like something that would cause your mom to give you an oral rinse with Lifebuoy. So, Dr. Donald Dossey coined the term paraskevidekatriaphobia. He says that by the time you manage to pronounce it, your phobia’s gone.
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