Tesla, GM and Visa among the actions of the “Memorial Day trade”
With the holidays and summer months on the horizon, CNBC’s Jim Cramer on Monday revealed a list of stocks that have a rising history on what’s dubbed the “Remembrance Day trade.”
âIf you buy those summer stocks on the trading day before Memorial Day weekend, which is three weeks away, and then sell them one to 15 days later, you tend to make a bundle,â Cramer said on âCrazy money. “
“I think each of these actions works like a long term investment right now.”
Summer stocks are companies that historically have seen a commercial boom during the hottest part of the year, especially everything to do with the outdoors and consumer spending. Auto and retail sales are generally on the rise, Cramer noted.
The commercial playbook, which is championed by well-regarded market guru Larry Williams, includes General Motors, Newell Brands, and Camping World, among others.
Looking at Tesla’s daily chart, Cramer noted that the red line represents Williams’ seasonal forecast. Tesla shares are down more than 10% this year after a massive run in 2020.
“In the case of Tesla, if you bought it one day before the holidays, with a stop-loss order of 10 points, then sold it ten to fifteen days later … you made an amazing 5-8% gain on average. “Cramer explained. “Best of all, it has worked every year for the past 10 years.”
Consumers are also more willing to use their credit cards during the summer, which makes stocks like Visa attractive, he said.
âBased on the seasonal pattern of the daily chart, Visa is expected to continue to climb through mid-June, which matches Memorial Day data,â he said.