I enjoy reading Bloomberg’s John Authers’ daily blog and generally agree with his conclusions when presented. His recent article about a phenomenon that Ned Davis Research calls the ‘Goodnight Moon trade’ is an exception. NDR published a chart that shows buying SPY at each day’s closing price and selling it immediately following the next day’s opening leads to superior returns when compared to holding the SPY. The same chart shows inferior returns when buying SPY at the opening and selling it at the close. I am not disagreeing with the data, but the author’s conclusion is an overreach in my opinion. He states that day trading is a “mug’s game.” It would be more accurate to state that day trading the SPY ETF might be a losing trade on average. I do not believe that the data presented supports the idea that day trading is unsuccessful. Is day trading other financial instruments as unsuccessful? How about options in particular? The definition of day trader is important here. The author has extrapolated his conclusion and in the process denigrated the concept of day trading. I think the article does a disservice by ruling that day trading is a worse than useless concept while in reality it possibly provides another avenue for traders to profit. A link to sign up to John Authers’ blog can be found at the end of my first Commentary post.