×

The best trades to make before Labor Day

Before you clock out early for the Labor Day long weekend, check out a few of these holiday trades. Think video games and online shopping.

Historical data suggest that certain consumer stocks get a boost on the Friday before Labor Day as shoppers hit up end-of-summer and back-to-school sales.

Using analysis from Kensho, a data analytics platform for financial markets, we found a few names that could pay to watch.

While parents may prefer their kids stock up on books and binders ahead of a new school year, video game sales may end up a bigger draw.

Vote
Vote to see results
Total Votes:

Not a Scientific Survey. Results may not total 100% due to rounding.

Gamestop is the world's largest retailer of video games and related products, and typically outperforms the broader markets ahead of the holiday. On the Friday before Labor Day, it has traded higher 10 of the last 13 years and returned more than 2 percent on average.

Compare that to more traditional back-to-school retailer Staples. Over the last 25 years, it has traded positive only about half the time and returned just 0.3 percent. That's slightly more than the S&P 500 average return on that day of 0.2 percent.

It may be that more consumers are skipping the crowds and taking advantage of online sales.

E-commerce giant Amazon is another stock that has enjoyed a pre-Labor Day boost. A check of its website shows plenty of holiday deals on offer from electronics to books and even pet supplies. Since 1997, Amazon's stock has traded positive more than 70 percent of the time and returned 1.8 percent on average on the Friday before the holiday weekend.

And whether you buy your kicks online or in store, Nike has also been a reliable bet. Over the last 25 years, it has traded positive more than 75 percent of the time and returned 0.9 percent on average.

Lastly, a few retail ETFs typically outperform the broader markets ahead of Labor Day.

The Market Vectors Retail ETF and the SPDR S&P Retail ETF have both traded higher nearly 80 percent of the time on the Friday before Labor Day and their average returns in the session—both 0.4 percent—beat that of the S&P 500.

September has historically been the toughest month of the year for stocks—but a few good Labor Day trades could start your portfolio off on the right footing.

Disclosure: NBC Universal, the parent company of CNBC, is a minority investor in Kensho.