2025 it has been a rather crazy year for the stock market, yet it is poised to post its third year of bullish performance. To keep the party going, I am following these four year-end trading strategies.
First, let’s look back on the year. Markets plummeted in April right after “Liberation Day” when President Trump first announced sweeping tariffs on specific countries. It felt like death. Stocks lost nearly all their gains from 2024 in a few short days.
But, the bulls put their horns back on and managed to get control of the trend. Since that fateful fall, the stock market is up better than 33% across the board. The Russell 2K is up a staggering 48% since early April. Talk about a bull rally!
That brings us to today. Here we are in the last couple of weeks of trading in 2025, with just 12 days of trading left (as of December 15). Here’s a look at my playbook during this time.
4 year-end trading strategies I’ll be following
1. Do not become complacent
There are so many distractions during the holiday season, and it’s easy to lose focus. Do not become complacent and assume the market will just go up everyday forever.
My best performance is when there is some fear in my gut. If I worry the markets will zig when we want them to zag and my portfolio is suddenly in jeopardy of disappearing, I am far more likely to notice a change in trend.
Check yourself to make sure you’re ready for any piece of news that could cause a stock to move.
2. Raise cash
Cash is my most important asset right now. The last couple of trading weeks of the year could be tough. I want to be ready for big swings in price action and news that could cause some wild movements.
I realize the VIX is low, so maybe it won’t matter. I am not here to make that judgment. Instead, I want to be ready in case a great buy opportunity presents itself.
3. Buy puts
Who loves to pay for insurance that you might never use? That’s rhetorical, because of course the answer is “no one”.
I always talk about playing defense, and that means buying index puts to protect your portfolio from sudden market volatility. If you’re long the market, you probably don’t need or want to buy puts. But for shorter-term options traders, you will sleep better at night.
Given the high uncertainty in the near-term, it is critical to have puts on, win or lose. I have often said I feel better about buying more long calls if I have put protection working at all times.
4. Take it slow
If you subscribe to my Daily Bites (sent on Mondays and Thursdays), you’ve recently heard me say to not jump quickly, take a breath, and slow down. Successfully trading over the long-term is an intentional process that starts with patience and observation. Once you have a full technical picture of a stock, you can take action.
Practice this sequence for the next couple of weeks, and you’ll soar in 2026.
