WALL STREET’S ONLY “FREE LUNCH” SERVED AT YEAR-END

Investors tend to get rid of their losers near year-end for tax purposes, often hammeringthese stocks down to bargain levels. Over the years the Almanac has shown that NYSEstocks selling at their lows on December 15 will usually outperform the market by February15 in the following year. Preferred stocks, closed-end funds, splits and new issues areeliminated. When there are a huge number of new lows, stocks down the most are selected,even though there are usually good reasons why some stocks have been battered.

Investors tend to get rid of their losers near year-end for tax purposes, often hammering these stocks down to bargain levels. Over the years the Almanac has shown that NYSE stocks selling at their lows on December 15 will usually outperform the market by February 15 in the following year. Preferred stocks, closed-end funds, splits and new issues are eliminated. When there are a huge number of new lows, stocks down the most are selected,even though there are usually good reasons why some stocks have been battered.

However, tax selling in recent years seems to be continuing down to the last few days of the year。

This “Free Lunch” strategy is only an extremely short-term strategy reserved for thenimblest traders. It has performed better after market corrections and when there are more New Lows at year-end. The object is to buy bargain stocks near their 52-week lows and sell any quick, generous gains, as they can often be real dogs.

CFC，JOE？