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Definition

An American phenomena which means the tendency for securities prices to recover in January after tax-related selling is completed before the year-end. Our database of the S&P500 index goes back to 1989 and the following chart shows the Januaries since then, where the S&P has risen:
<img src="http://www.pdsnet.co.za/onlinecourse/images/Januaryeffgloss.png" />
S&P500 Index: 1989 - January 2022. Chart by ShareFriend Pro.
 
In this chart you can see that during bull trends, the S&P500 index invariably rises in January month. The times when it has fallen include the 9/11 2001 bear trend which continued until 2003, the sub-prime crisis in 2008 which extended until 2009 and the major correction in 2015/16. It also seems fairly certain that the S&P will make a series of new record highs in January 2022.

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