Top-Ranked ETFs & Stocks To Profit From The January Effect
Zacks Investment Research | Jan 02, 2020 11:00PM ET
After registering the strongest year since 2013, Wall Street is poised to gain from the historical trend of “January Effect.”
What is January Effect?
January Effect is a seasonal increase in stock prices due largely to year-end tax considerations. Investors redeploy their capital to speculate on weaker performers in January after selling winners in December to create tax losses. This phenomenon pushes the stock market higher in the first month of the year.
While large caps tend to perform better, small-cap securities have historically proven their outperformance in January. According to some market experts, the January Effect actually runs from mid-December through February, with the small caps outperforming their large-cap cousins (read: Zacks Investment Research
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