Encyclopedia of Investment Terminology

Return to Stock Market and Investment Encyclopedia Index

January Effect

The January effect in an investment deals with a common occurrence where prices in financial instruments like stocks and bonds tend to go up every January. This is considered to be due to people selling off stocks late in the year to avoid additional taxes and claim capital losses. Because of this people will buy financial instruments right before January and then sell them after January.

Return to Index

Copyright 2008 StockDic.com
All Rights Reserved.