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To: Wayne J. who wrote (4076)12/9/1998 9:39:00 PM
From: ISOMAN  Read Replies (1) | Respond to of 9824
 
The January effect is this:

In late Nov/December many people begin to sell some of their stocks at a tax loss to offset capital gains.

Since everyone knows this, in the business, the stock prices of many stocks begin to drop fast.

Many people buy these depressed stocks in December at their lows.

Then in January the stocks return to normal, and the bottom fishers from December sell for a quick profit.

The problem is that it doesn't effect all stocks. You kinda have to monitor a number of stocks for a year or two, so you know what normal is.

Last year I picked three stocks and bought in the third week in December. I sold them the first week of January and the total return was over 400%.

You can make a lot, or just tie up some money in a stock that isn't going to move.

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The march statement I made, is that once some deals start coming through, people won't be so panicy and the thread may have more DD done.