ASSETCASTING

How did stocks move around year-end and New Year during high-rate periods?

Average effective federal funds rate in month 11: at least 4% through 2025, at least 5% in 2026 → month 12 through month 1 of the next year

Total 34 · Completed 34 · Ongoing 0 · Excluded 0

Last observed 2024-12 · Updated 2026-10-09

Positive / completed cases26 / 34Negative 8 · Flat 0
Return Median+4.3%Mean +3.8%
Completed outcome range-7.8% ~ +11.6%Minimum ~ maximum

Same conditions, different outcomes

Positive and negative outcomes are compared against 0%. Ongoing and excluded cases are not included in the statistics. Open a case to explore its context.

End of 2024~beginning of 2025Completed · 2024-12+0.1%

Observed 2024-12 → 2025-01 · As of 2026-10-08

Average rate in month 11
4.64% · Applied criterion: at least 4%
Change in month 12
-2.50%
Change in month 1 of the following year
2.70%
Baseline and end dates
2025-01-31 close versus 2024-11-29 close

After falling in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 0.14%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 2023~beginning of 2024Completed · 2023-12+6.1%

Observed 2023-12 → 2024-01 · As of 2026-10-08

Average rate in month 11
5.33% · Applied criterion: at least 4%
Change in month 12
4.42%
Change in month 1 of the following year
1.59%
Baseline and end dates
2024-01-31 close versus 2023-11-30 close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 6.08%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 2007~beginning of 2008Completed · 2007-12-6.9%

Observed 2007-12 → 2008-01 · As of 2026-10-08

Average rate in month 11
4.49% · Applied criterion: at least 4%
Change in month 12
-0.86%
Change in month 1 of the following year
-6.12%
Baseline and end dates
2008-01 month-end close versus 2007-11 month-end close

After falling in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -6.93%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 2006~beginning of 2007Completed · 2006-12+2.7%

Observed 2006-12 → 2007-01 · As of 2026-10-08

Average rate in month 11
5.25% · Applied criterion: at least 4%
Change in month 12
1.26%
Change in month 1 of the following year
1.41%
Baseline and end dates
2007-01 month-end close versus 2006-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 2.69%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 2005~beginning of 2006Completed · 2005-12+2.4%

Observed 2005-12 → 2006-01 · As of 2026-10-08

Average rate in month 11
4% · Applied criterion: at least 4%
Change in month 12
-0.10%
Change in month 1 of the following year
2.55%
Baseline and end dates
2006-01 month-end close versus 2005-11 month-end close

After falling in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 2.45%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 2000~beginning of 2001Completed · 2000-12+3.9%

Observed 2000-12 → 2001-01 · As of 2026-10-08

Average rate in month 11
6.51% · Applied criterion: at least 4%
Change in month 12
0.41%
Change in month 1 of the following year
3.46%
Baseline and end dates
2001-01 month-end close versus 2000-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 3.88%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1999~beginning of 2000Completed · 1999-12+0.4%

Observed 1999-12 → 2000-01 · As of 2026-10-08

Average rate in month 11
5.42% · Applied criterion: at least 4%
Change in month 12
5.78%
Change in month 1 of the following year
-5.09%
Baseline and end dates
2000-01 month-end close versus 1999-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is 0.40%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1998~beginning of 1999Completed · 1998-12+10%

Observed 1998-12 → 1999-01 · As of 2026-10-08

Average rate in month 11
4.83% · Applied criterion: at least 4%
Change in month 12
5.64%
Change in month 1 of the following year
4.10%
Baseline and end dates
1999-01 month-end close versus 1998-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 9.97%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1997~beginning of 1998Completed · 1997-12+2.6%

Observed 1997-12 → 1998-01 · As of 2026-10-08

Average rate in month 11
5.52% · Applied criterion: at least 4%
Change in month 12
1.57%
Change in month 1 of the following year
1.02%
Baseline and end dates
1998-01 month-end close versus 1997-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 2.60%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1996~beginning of 1997Completed · 1996-12+3.8%

Observed 1996-12 → 1997-01 · As of 2026-10-08

Average rate in month 11
5.31% · Applied criterion: at least 4%
Change in month 12
-2.15%
Change in month 1 of the following year
6.13%
Baseline and end dates
1997-01 month-end close versus 1996-11 month-end close

After falling in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 3.85%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1995~beginning of 1996Completed · 1995-12+5.1%

Observed 1995-12 → 1996-01 · As of 2026-10-08

Average rate in month 11
5.8% · Applied criterion: at least 4%
Change in month 12
1.74%
Change in month 1 of the following year
3.26%
Baseline and end dates
1996-01 month-end close versus 1995-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 5.06%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1994~beginning of 1995Completed · 1994-12+3.7%

Observed 1994-12 → 1995-01 · As of 2026-10-08

Average rate in month 11
5.29% · Applied criterion: at least 4%
Change in month 12
1.23%
Change in month 1 of the following year
2.43%
Baseline and end dates
1995-01 month-end close versus 1994-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 3.69%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1991~beginning of 1992Completed · 1991-12+8.9%

Observed 1991-12 → 1992-01 · As of 2026-10-08

Average rate in month 11
4.81% · Applied criterion: at least 4%
Change in month 12
11.16%
Change in month 1 of the following year
-1.99%
Baseline and end dates
1992-01 month-end close versus 1991-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is 8.94%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1990~beginning of 1991Completed · 1990-12+6.7%

Observed 1990-12 → 1991-01 · As of 2026-10-08

Average rate in month 11
7.81% · Applied criterion: at least 4%
Change in month 12
2.48%
Change in month 1 of the following year
4.15%
Baseline and end dates
1991-01 month-end close versus 1990-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 6.74%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1989~beginning of 1990Completed · 1989-12-4.9%

Observed 1989-12 → 1990-01 · As of 2026-10-08

Average rate in month 11
8.55% · Applied criterion: at least 4%
Change in month 12
2.14%
Change in month 1 of the following year
-6.88%
Baseline and end dates
1990-01 month-end close versus 1989-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -4.89%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1988~beginning of 1989Completed · 1988-12+8.7%

Observed 1988-12 → 1989-01 · As of 2026-10-08

Average rate in month 11
8.35% · Applied criterion: at least 4%
Change in month 12
1.47%
Change in month 1 of the following year
7.11%
Baseline and end dates
1989-01 month-end close versus 1988-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 8.68%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1987~beginning of 1988Completed · 1987-12+11.6%

Observed 1987-12 → 1988-01 · As of 2026-10-08

Average rate in month 11
6.69% · Applied criterion: at least 4%
Change in month 12
7.29%
Change in month 1 of the following year
4.04%
Baseline and end dates
1988-01 month-end close versus 1987-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 11.62%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1986~beginning of 1987Completed · 1986-12+10%

Observed 1986-12 → 1987-01 · As of 2026-10-08

Average rate in month 11
6.04% · Applied criterion: at least 4%
Change in month 12
-2.83%
Change in month 1 of the following year
13.18%
Baseline and end dates
1987-01 month-end close versus 1986-11 month-end close

After falling in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 9.98%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1985~beginning of 1986Completed · 1985-12+4.8%

Observed 1985-12 → 1986-01 · As of 2026-10-08

Average rate in month 11
8.05% · Applied criterion: at least 4%
Change in month 12
4.51%
Change in month 1 of the following year
0.24%
Baseline and end dates
1986-01 month-end close versus 1985-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 4.75%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1984~beginning of 1985Completed · 1984-12+9.8%

Observed 1984-12 → 1985-01 · As of 2026-10-08

Average rate in month 11
9.43% · Applied criterion: at least 4%
Change in month 12
2.24%
Change in month 1 of the following year
7.41%
Baseline and end dates
1985-01 month-end close versus 1984-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 9.81%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1983~beginning of 1984Completed · 1983-12-1.8%

Observed 1983-12 → 1984-01 · As of 2026-10-08

Average rate in month 11
9.34% · Applied criterion: at least 4%
Change in month 12
-0.88%
Change in month 1 of the following year
-0.92%
Baseline and end dates
1984-01 month-end close versus 1983-11 month-end close

After falling in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -1.80%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1982~beginning of 1983Completed · 1982-12+4.9%

Observed 1982-12 → 1983-01 · As of 2026-10-08

Average rate in month 11
9.2% · Applied criterion: at least 4%
Change in month 12
1.52%
Change in month 1 of the following year
3.31%
Baseline and end dates
1983-01 month-end close versus 1982-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 4.89%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1981~beginning of 1982Completed · 1981-12-4.7%

Observed 1981-12 → 1982-01 · As of 2026-10-08

Average rate in month 11
13.31% · Applied criterion: at least 4%
Change in month 12
-3.01%
Change in month 1 of the following year
-1.75%
Baseline and end dates
1982-01 month-end close versus 1981-11 month-end close

After falling in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -4.71%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1980~beginning of 1981Completed · 1980-12-7.8%

Observed 1980-12 → 1981-01 · As of 2026-10-08

Average rate in month 11
15.85% · Applied criterion: at least 4%
Change in month 12
-3.39%
Change in month 1 of the following year
-4.57%
Baseline and end dates
1981-01 month-end close versus 1980-11 month-end close

After falling in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -7.81%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1979~beginning of 1980Completed · 1979-12+7.5%

Observed 1979-12 → 1980-01 · As of 2026-10-08

Average rate in month 11
13.18% · Applied criterion: at least 4%
Change in month 12
1.68%
Change in month 1 of the following year
5.76%
Baseline and end dates
1980-01 month-end close versus 1979-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 7.54%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1978~beginning of 1979Completed · 1978-12+5.5%

Observed 1978-12 → 1979-01 · As of 2026-10-08

Average rate in month 11
9.76% · Applied criterion: at least 4%
Change in month 12
1.49%
Change in month 1 of the following year
3.97%
Baseline and end dates
1979-01 month-end close versus 1978-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 5.52%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1977~beginning of 1978Completed · 1977-12-5.9%

Observed 1977-12 → 1978-01 · As of 2026-10-08

Average rate in month 11
6.51% · Applied criterion: at least 4%
Change in month 12
0.28%
Change in month 1 of the following year
-6.15%
Baseline and end dates
1978-01 month-end close versus 1977-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -5.88%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1976~beginning of 1977Completed · 1976-12-0.1%

Observed 1976-12 → 1977-01 · As of 2026-10-08

Average rate in month 11
4.95% · Applied criterion: at least 4%
Change in month 12
5.25%
Change in month 1 of the following year
-5.05%
Baseline and end dates
1977-01 month-end close versus 1976-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -0.07%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1975~beginning of 1976Completed · 1975-12+10.5%

Observed 1975-12 → 1976-01 · As of 2026-10-08

Average rate in month 11
5.22% · Applied criterion: at least 4%
Change in month 12
-1.15%
Change in month 1 of the following year
11.83%
Baseline and end dates
1976-01 month-end close versus 1975-11 month-end close

After falling in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 10.54%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1974~beginning of 1975Completed · 1974-12+10%

Observed 1974-12 → 1975-01 · As of 2026-10-08

Average rate in month 11
9.45% · Applied criterion: at least 4%
Change in month 12
-2.02%
Change in month 1 of the following year
12.28%
Baseline and end dates
1975-01 month-end close versus 1974-11 month-end close

After falling in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 10.02%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1973~beginning of 1974Completed · 1973-12+0.6%

Observed 1973-12 → 1974-01 · As of 2026-10-08

Average rate in month 11
10.03% · Applied criterion: at least 4%
Change in month 12
1.66%
Change in month 1 of the following year
-1.00%
Baseline and end dates
1974-01 month-end close versus 1973-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is 0.64%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1972~beginning of 1973Completed · 1972-12-0.5%

Observed 1972-12 → 1973-01 · As of 2026-10-08

Average rate in month 11
5.06% · Applied criterion: at least 4%
Change in month 12
1.18%
Change in month 1 of the following year
-1.71%
Baseline and end dates
1973-01 month-end close versus 1972-11 month-end close

After rising in month 12, prices fell in month 1 of the next year. Cumulative change over the two months is -0.55%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1971~beginning of 1972Completed · 1971-12+10.6%

Observed 1971-12 → 1972-01 · As of 2026-10-08

Average rate in month 11
4.91% · Applied criterion: at least 4%
Change in month 12
8.62%
Change in month 1 of the following year
1.81%
Baseline and end dates
1972-01 month-end close versus 1971-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 10.59%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

End of 1970~beginning of 1971Completed · 1970-12+10%

Observed 1970-12 → 1971-01 · As of 2026-10-08

Average rate in month 11
5.6% · Applied criterion: at least 4%
Change in month 12
5.68%
Change in month 1 of the following year
4.05%
Baseline and end dates
1971-01 month-end close versus 1970-11 month-end close

After rising in month 12, prices rose in month 1 of the next year. Cumulative change over the two months is 9.95%. Monthly changes are not simply added, and interest rates are not established as the cause of the result.

How to interpret this

Of the 34 qualifying windows, 26 had positive cumulative changes over the two months and 8 had negative changes. Mean cumulative change was 3.78% for qualifying windows, 0.74% for the 22 non-qualifying windows and 2.58% across all 56 windows. In some cases, a year-end rise reversed into a New Year decline. Inflation, growth and policy conditions differ across periods, and multiple years belong to the same interest-rate cycle, so these are not independent samples. A simple difference in averages does not establish a causal effect of high rates, statistical significance, predictive power or outperformance.

Periods before 1970 are excluded. The significance of a 4% rate differs across eras; no adjustments were made for real rates or the interest-rate distribution at the time. Data providers can differ in revisions and rounding. Price-index changes exclude dividends, transaction costs, taxes and exchange rates. These are ASSETCASTING’s own calculations, not an endorsement by S&P Dow Jones Indices, FRED or any data provider. Rights to the underlying index belong to S&P Dow Jones Indices.

Conditions, methodology and sources

Examines 56 windows beginning in 1970~2025. A user-defined criterion applies an average US effective federal funds rate in month 11 of at least 4% through 2025 and at least 5% in 2026. This is not a universal definition of high rates. Month 11 of 2026 and subsequent performance are not yet available and are not counted. The change for month 12 compares the last close of month 12 with the last close of month 11; month 1 compares the last close of month 1 with the end of month 12; cumulative change compares the end of month 1 with the end of month 11. Before 2016, Digrin’s month-end price column is used; afterward, FRED daily closing prices are used, without mixing monthly averages or dividend-reinvestment indices. Recent overlapping windows and historical issuer disclosures were cross-checked. Month-start dates represent stored observation months. This is an ex-post comparison using revised data, not a trading backtest incorporating the actual release time of the average for month 11. It is an exploratory analysis in which the historical criterion was changed to 4% at the user’s request after the initial 5% criterion produced only 1 recent case.