With Christmas right around the corner, it’s no surprise that everyone’s gearing up for the holidays. But did you know Saint Nick has a long-standing tradition of gift-giving on Wall Street, too?
The Santa Claus rally is a phenomenon that happens during the last five trading days of December and the first two trading days of January. During these times, stocks have historically performed well. The phenomenon is theorized to be caused by holiday-season optimism, the arrival of bonuses that free up cash flow for regular folks, portfolio rebalancing, and the end of tax-loss selling.
