Run into more customer service bots lately? Let Marketplace Tech know. More info

Buzzword: January effect

Marketplace Staff Dec 29, 2006

Noise makers and a bottle of bubbly bring us this week’s Marketplace Money buzzword, January effect. The January effect is the stock market’s tendency to increase in value between New Year’s Eve and the first week of the year. Why? Because investors who just sold stocks to save on last year’s taxes are buying them up again. This doesn’t mean easy earnings for your Christmas cash. The January effect’s no secret, so stocks may be pricy. Plus, studies show only small cap stocks really feel light headed, that is if there’s a January effect at all. Some experts say it no longer exists.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.