A Santa Claus rally describes sustained increases in the stock market that begin on December 26th and extend through January 2nd.
 | | Term of the Day | Words to Know | | |  | | Santa Claus Rally | | A Santa Claus rally describes a sustained increase in the stock market that occur in the last week of December through the first two trading days in January. There are numerous explanations for the causes of a Santa Claus rally including tax considerations, a general feeling of optimism and happiness on Wall Street and the investing of holiday bonuses. Another theory is that some very large institutional investors, a number of whom are more sophisticated and pessimistic, tend to go on vacation at this time leaving the market to retail investors, who tend to be more bullish. | | Read More » | | Related to "Santa Claus Rally" | | | | January Effect | | The January effect is the tendency for stock prices to rise in the first month of the year following a year-end sell-off for tax purposes. | | Read More » | | | Anomaly | | Anomaly is a term describing the incidence when the actual result under a given set of assumptions is different from the expected result. | | Read More » | | | Value Stock | | A value stock is a stock that tends to trade at a lower price relative to its fundamentals, making it appealing to value investors. | | Read More » | | | Growth Stock | | A growth stock is a publicly traded share in a company expected to grow at a rate higher than the market average. | | Read More » | | | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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