Monday Muddle #6 SANTA CLAUS RALLY It is explained as a surge in the price of stocks that often occurs in the week between Christmas and New Years Day. There are numerous explanations for the Santa Claus Rally phenomenon, including tax considerations, happiness around Wall Street, people investing their Christmas bonuses and the fact that the pessimists are usually on vacation this week. Many consider the Santa Claus rally to be a result of people buying stocks in anticipation of the rise in stock prices during the month of January usually when business resumes and demands are higher. This aspect is otherwise known as the January effect which presumably occurs when investors sell stocks in December only to buy them back in January for tax purposes.
Posted on: Mon, 21 Jul 2014 13:42:39 +0000
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