THE "JANUARY EFFECT"

   
THE PIG SAYS.........BE AWARE OF THE POTENTIAL FOR THE "JANUARY EFFECT"......

What is it ...............?

The Pig says its a  general increase in stock prices during the month of January. Usually a rally that is generally attributed to an increase in buying, which follows the drop in price that typically happens in December when investors, seeking to create tax losses to offset capital gains, prompt a sell-off.

The January effect is said to affect small caps more than mid or large caps. This historical trend, however, has been less pronounced in recent years because the markets have adjusted for it. Another reason the January effect is now considered less important is that more people are using tax-sheltered retirement plans and therefore have no reason to sell at the end of the year for a tax loss.