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Investing In January
By Living Healthy, Staying Wealthy  •  January 13, 2010
[caption id="attachment_3110" align="alignright" width="150" caption="Photo by Andrew Mason"]Photo by Andrew Mason[/caption] When investing in January, do take note of the January Effect and pay special attention to the first five days of January. The January Effect is a calendar-related anomaly in the financial market where financial security prices increase in the month of January. This rally is generally attributed to an increase in buying, which follows the drop in price that typically happens in December when investors, seeking to create tax losses to offset capital gains, prompt a sell-off. This type of pattern in price behavior on the financial market supports the fact that financial markets are not fully efficient. The January Effect was first observed in the early 1980s by Donald Keim who, at the time, was a graduate student at the University of Chicago. The "First Five Days of January Indicator," which focuses, not surprisingly, on the market's direction during the first five trading days of the New Year. If its direction is up over this period, the Indicator's devotees argue, then January as a whole is likely to show a gain -- which in turn would bode well for the whole year. 2010 started out strong as the NYSE jumped 3.31% while the NASDAQ climbed 2.21%. Read more...
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By Living Healthy, Staying Wealthy
Aaron Lau is a Independent Financial Adviser licensed by the Monetary Authority of Singapore to provide financial advice to individuals in Singapore. The main reason he is in the Financial Advisory industry is to share what he has learned after studying and comparing the various insurance and investment instruments in the market. He strongly feels that proper, quality financial planning is important to all individuals and sincerely would like to reach out to help as many as possible.
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