As 2024 nears the end, tax loss selling is performed for tax-loss harvesting by institutional and individual investors. This is the process of selling losing positions to take the capital loss to offset capital gains in other stocks in the portfolio. This accentuates the selling pressure for underperforming stocks. Investors usually wait 30 days to avoid the wash rule and buy back the shares. This results in the same stocks seeing inflows in January, propping up their prices. Many traders will jump into losing stocks in December for the potential bounce in January. Here are three underperforming stocks that may see a rebound in January as investors buy them back.
