What exactly is the "January effect" and why is it happening?
Hello. I know that the January effect is a seasonal increase in share prices in the month of January. Analysts generally attribute this rally to the increase in purchases resulting from the fall in prices that typically occurs in December, when investors engage in tax losses to offset realized capital gains and lead to a sell-off.
However, this is a cursory explanation. Could someone please explain to me in detail what this January effect is all about?