Monday Effect

AAA

DEFINITION of 'Monday Effect'

A theory that states that returns on the stock market on Mondays will follow the prevailing trend from the previous Friday. Therefore, if the market was up on Friday, it should continue through the weekend and, come Monday, resume its rise.

INVESTOPEDIA EXPLAINS 'Monday Effect'

Some studies have shown a similar correlation, but no one theory has been able to accurately explain the existence of the Monday effect.

RELATED TERMS
  1. Weekend Effect

    A phenomenon in financial markets in which stock returns on Mondays ...
  2. January Effect

    A general increase in stock prices during the month of January. ...
  3. October Effect

    The theory that stocks tend to decline during the month of October. ...
  4. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week ...
  5. Calendar Effect

    A collection of assorted theories that assert that certain days, ...
  6. Market Value

    The price an asset would fetch in the marketplace. Market value ...
Related Articles
  1. Active Trading Fundamentals

    An Introduction To Behavioral Finance

    Curious about how emotions and biases affect the market? Find some useful insight here.
  2. Explain the logic behind government loans, how they work, why are they so big in the U.S and how they have an influence in the economy of the U.S and potentially abroad
    Economics

    An Introduction to Government Loans

    Government loans further policymakers' efforts to create positive social outcomes by offering timely access to capital for qualified candidates.
  3. Capital Markets are financial markets.
    Markets

    Capital Markets

    Capital Markets are financial markets where organizations that need money for productive long-term purposes.
  4. Bonds & Fixed Income

    Spotting A Market Bottom

    Recognizing a market bottom can lead to huge opportunities for an investor. We go over how you can spot the bottom so that you can reap the rewards.
  5. Investing Basics

    What exactly is being done when shares are bought and sold?

    Most stocks are traded on physical or virtual exchanges. The New York Stock Exchange (NYSE), for example, is a physical exchange where some trades are placed manually on a trading floor (other ...
  6. Economics

    Introduction To Asian Financial Markets

    We look at the history of Asia's financial development and how investors can get involved in these growing markets.
  7. Investing

    How does FINRA differ from the SEC?

    With all the financial organizations out there, knowing what they all do can be as complicated as knowing where to invest. The Securities and Exchange Commission (SEC) and the Financial Industry ...
  8. Active Trading

    Get Positive Earnings In The Negative-Sum Market

    Gain an advantage in the markets by understanding how to win in a negative-sum game.
  9. Investing

    What is the difference between the Dow and the Nasdaq?

    Because of the way people throw around the words "Dow" and "Nasdaq," both terms have become synonymous with "the market," giving people a hazy idea of what each term actually means. In this question, ...
  10. Economics

    Advocacy Group Seeks To Change Name Of S&P 500

    "Brokers Against Unpleasant Sociolinguistics" are campaigning to change the name of the S&P 500 Index.

You May Also Like

Hot Definitions
  1. Christmas Club

    A short-term savings account that usually pays out the full account balance to its account holders once each year, right ...
  2. Boston Snow Indicator

    A market theory that states that a white Christmas in Boston will result in rising stock prices for the following year. For ...
  3. Christmas Island Dollar

    The former currency of Christmas Island, an Australian island in the Indian Ocean that was discovered on December 25, 1643. ...
  4. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  5. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  6. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
Trading Center