Sitting out of the S&P 500 on the biggest up days will cost you. And some stocks rally big time on these huge days.
Ten stocks in the S&P 500, including Tesla and financials like KeyCorp and Zions Bancorporation, posted the largest average gains in this year's best nine days of the year, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. All these stocks gained an average of 6% or more in each of these top days where the S&P 500 usually rose about 2%. Gains like those can make a year.
Just nine trading days this year, including Tuesday's nearly 2% jump in the S&P 500, "explain the entire gain" of the year, says Nicholas Colas of DataTrek Research.
So if you want to maximize your gains, not owning the right stocks on the right days will cost you.
Missing The Best Days Stings
This year isn't unusual either. Missing out on just a few good days historically crushes your results.
About eight of 10 (78%) of the stock market's best days occur during a bear market or during the first two months of a new bull, according to Hartford Funds. And if you missed the market's 10 best days over the past 30 years, your returns would have been cut in half.
This year, the best days for the S&P 500 "came with positive news on short/long term interest rates, Big Tech earnings and avoiding an imminent recession," Colas says. "These same issues remain relevant now and are the most likely catalysts for a further U.S. equity rally."
So, which S&P 500 stocks thrived on the market's best days this year?
Financials Rock On Best Days This Year
When S&P 500 investors scramble to buy stocks on good days, they race for the financial sector. Four of the top performers on the year's best nine days are all financials. That's the highest representation among all 11 S&P 500 sectors.
And that includes the two S&P 500 stocks ranked the highest on those days for average gains. KeyCorp, a Cleveland, Ohio-based regional bank, is the go-to buy this year. Shares of the bank jumped 6.1% on average during the best nine days this year. That's miles ahead of the S&P 500's 1.9% gain on each of those days on average. One of Key's biggest jumps this year, 10% on May 5, happened as JPMorgan Chase's upgrade of shares of "select U.S. regional bank stocks was a vote of confidence for this group, beleaguered by March's Silicon Valley Bank failure," Colas said.
The next biggest gainer on up days is Zions, which jumped 6% on average on the year's top nine trading days. The stock benefits, too, from any news that regional banks are in better financial shape than feared.
Tesla: A Favorite On Good Days
But it would be remiss to not mention Tesla. This is a key S&P 500 stock investors rush to when the market rallies. The electric vehicle maker's shares surged an average of 4.5% on those good days. Its best was a 6% rally on Nov. 2. That's the day the S&P 500 jumped 1.9% as investors celebrated "the FOMC passing on rate hikes at two consecutive meetings and Chair Powell sounding happy with current monetary policy, 10-year Treasury yields fell from 4.79% to 4.67%," Colas said.
Investors hope more good days are coming for the S&P 500. And if they do, they certainly have their favorites when they're feeling bullish.
Top S&P 500 On Year's Best Days
Largest average gains on top days this year for S&P 500
| Company | Ticker | Avg. % gain top days | Sector |
|---|---|---|---|
| KeyCorp | KEY | 6.1% | Financials |
| Zions Bancorporation | ZION | 6.0 | Financials |
| Comerica | CMA | 5.0 | Financials |
| Tesla | TSLA | 4.5 | Consumer Discretionary |
| Warner Bros. Discovery | WBD | 4.3 | Communication Services |
| First Solar | FSLR | 4.3 | Information Technology |
| Citizens Financial | CFG | 4.2 | Financials |
| Meta Platforms | META | 4.1 | Communication Services |
| KLA | KLAC | 4.0 | Information Technology |
| VF | VFC | 4.0 | Consumer Discretionary |
| S&P 500 | 1.9 |
