The January Effect refers to the observation that in January small stocks seem to under-perform the market.

Name: The January Effect refers to the observation that in January small stocks seem to under-perform the market.
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Because stockholders may sell off their losers in late December to establish tax losses, these stocks are often depressed in value in early January and may represent bargains and an opportunity for high returns. This is the January Effect.

The January Effect Refers to the Observation That in January