Month-of-year long
Some calendar months have historically been better for Indian stocks than others. This strategy turns that idea into a rule: buy NIFTY futures at the close of the month before a 'strong' month, hold through it, and sell at its last close. The default holds only September; other modes hold November to April ('sell in May') or let past years pick the three best months.How it trades
Results
PRE-BUILT · DEFAULTSWhere it made and lost money
With the default setting the strategy traded one month, September 2026, split into two pieces by the futures expiry, so the evidence cannot show where the rule works. The piece from the end of August to the September expiry, during which NIFTY fell more than 1%, lost ₹99,437. The short piece after the roll lost ₹11,875 while NIFTY moved less than 1%. A whole-month long with no stop simply takes the month's move, and in this test September was a falling month.
About this strategy
- Decide which months to hold: September by default, November to April in the 'sell in May' mode, or the three months with the best average return in the previous four years in walk-forward mode.
- At the close of the last session before a chosen month, buy one lot of the near-month NIFTY future.
- At the monthly futures expiry inside the month, close and buy the next month's contract to carry on.
- Sell at the close of the chosen month's last session. There is no stop and no target.
- Stay flat in every month that was not chosen.
Why traders use it
Seasonal patterns such as 'sell in May and go away' are among the oldest market sayings, and studies of Indian indices have found some months stronger on average than others, often linked to fund flows, festive demand or results seasons. A month filter is simple to follow and keeps money out of the market most of the year. The walk-forward mode tests the idea honestly by choosing months only from data available at the time.
The year in plain words
On NIFTY from 1 Oct 2025 to 30 Sep 2026 with the default September-only setting, the strategy held one month, recorded as two trades because of the monthly futures roll. Both lost: ₹99,437 on the first piece and ₹11,875 on the second, a total of ₹1,11,312 before costs. With so few orders, costs added little, and the after-costs loss was ₹1,12,134. One month of one year says nothing about whether September is reliably strong; it shows only that a single month's move decides everything with a whole-month, unstopped long.
What the settings do
Risks
- One observation per month per year makes any seasonal edge very hard to confirm.
- Months picked from past averages may reflect chance rather than a lasting pattern.
- A full NIFTY futures lot held for a month without a stop can lose lakhs on a bad month.
- The monthly roll adds orders and a spread cost every month held.
Who it suits
Investors and traders curious about calendar effects who want a simple, low-activity rule, and who can hold a futures position for a month without a stop. It suits those comfortable judging results over many years, not one.
Questions traders ask
Which month is best for the Indian stock market?
Historical averages vary by period, and different studies point to different months. Averages built from a handful of years can change sharply with one new year of data. This strategy lets you test a fixed list, the November to April half-year, or months picked only from earlier years.
Is the month-of-year seasonality strategy profitable?
Not in this test. Holding NIFTY futures through September 2026, the only month traded from 1 Oct 2025 to 30 Sep 2026, lost ₹1,11,312 before costs and ₹1,12,134 after ₹20 per order and bid-ask slippage (statutory charges not included). Past results do not guarantee future ones.
What does 'sell in May and go away' mean?
It is a market saying that the November to April half-year tends to outperform May to October. In this strategy's sell_in_may mode, NIFTY futures are held from the end of October to the end of April and the position is flat for the other six months.
Why is the walk-forward mode important?
Choosing the best months from the same years you then test is hindsight. Walk-forward mode ranks months using only data from before each decision, which is how a trader would actually have had to choose.