What's The Best Day Of The Week To Buy Precious Metals?

Includes: GLD, SLV
by: Henry Swann

There is a lot of excitement in gold and silver trading these days, and many smaller retail investors are able to easily invest in the precious metals by trading ETFs. In particular, the SPDR Gold Trust (NYSEARCA:GLD) and iShares Silver Trust (NYSEARCA:SLV), which seek to roughly match the gold and silver markets, respectively.

According to Yahoo Finance, GLD has returned 22.85% over the three years ending February 28, 2012, and SLV has gained 37.12% over the same period. An investor willing to buy and hold would have done well over that time, if they could stomach the considerable volatility that the metals undergo.

As a small investor can easily be trampled by large institutional buying, I did some analysis to see if there were patterns that an investor might use to avoid sell-offs. I checked the total returns by day of the week for both the GLD and SLV since inception (calculated from the prior close to the close for the day listed):

Day of Week GLD SLV
Monday -1.10 -1.83
Tuesday 40.25 14.75
Wednesday 48.30 12.52
Thursday -22.43 -13.81
Friday 64.09 10.49
Click to enlarge


  • GLD 11/18/2004 - 2/28/2012

  • SLV 4/28-2006 - 2/28/2012 (adjusted for splits)

As you can see from the chart, the best days to own Gold and Silver are Tuesday, Wednesday and Friday, and it would be best to avoid Mondays and Thursdays. These are averages over several years, so performance will certainly vary week to week.

This is not to say that you can't make money on the metals on a Thursday, but if you are interested in playing the percentages (counting cards, if you will) it is much better to wait until close on Thursday or Monday to buy. And if you want to take profits, Wednesday or late Friday seem like the best times.

Why Does Return Vary by Day of Week?

I did some additional analysis to determine why Monday and Thursday were down days on average. I looked at volume: For GLD, Monday is a slightly lower average volume day, but Thursday is in line with the rest of the week. I am open to suggestions on a reason for this pattern, but it possibly involves some technical trading related to futures and their impact on GLD and SLV.

Whatever the reason, investors can make their own determination whether they want to try to beat the odds or take advantage of a clear weekly trend in the price movement of the top two precious metals.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.