Is there a trading or investment strategy for Singles Day?

Ah, Singles Day. The day when the whole of China gets online and goes on a shopping spree. First popularized by Alibaba in 2009, Singles Day has become the mainstay of China’s retail sales in the one-and-a-half decade following that. It is common to see deals reaching up to 90% discount, and Chinese people go crazy for every deal on E-commerce platforms.

Things are different though this year in 2023. What started as optimism at the beginning of the year has turned into a big concern for many investors. Consumer confidence is just not as strong as expected, with the housing sector in shambles. Retail sales have consistently come in weaker-than-expected, with the global economy being weak also, not providing any boost to its export sectors.

Hence, investors have been looking forward to Singles Day for any signs of optimism in consumer spending. Hence, here are the share price performances of E-commerce companies one day and to date after November 10.

It does seem like for 2023, there is a trading case that can be made about investing in E-commerce companies before Singles Day. Alibaba, JD, Meituan and Netease all racked in impressive share price performances to date since 10 November 2023. JD in particular, recorded record-breaking sales and transaction volumes on its platform. It managed to utilize its live-streaming services to rake in 380 million visitors and garnered RMB1 billion in sales volume from its merchants.

But is it a tried-and-true strategy historically? Here’s the one-week performance of these companies for 2020, 2021 and 2022 after Singles Day.

Why it matters to you: IT seems like there is a high chance that E-commerce companies in China performed better during the Singles Day week. Alibaba and JD in particular registered outsized share price performance, while Netease registered consistent positive returns. However, for Meituan, this effect is more muted and less reliable. Do your research and technical analysis to determine the best point of entry!