Santa Claus did arrive and rallied in 2013.
Definition of 'Santa Claus Rally'
A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations for the Santa Claus Rally phenomenon, including tax considerations, happiness around Wall Street, people investing their Christmas bonuses and the fact that the pessimists are usually on vacation this week.
Investopedia explains 'Santa Claus Rally'
Many consider the Santa Claus rally to be a result of people buying stocks in anticipation of the rise in stock prices during the month of January, otherwise known as the January effect.
WhatIs . com
Definition Santa Claus rally
A Santa Claus rally (sometimes referred to as the Santa Claus effect or the December effect) is a sharp rise in stock prices that sometimes occurs around Christmas.
Various theories have been proposed to explain the Santa Claus rally, including the following:Employees are investing their Christmas bonuses.People are making investments before the end of the year for tax purposes.Corporations are adjusting their holdings for a better appearance at the end of the year.Wall Street is in a festive mood.Pessimists are on holiday, leaving optimists to do the investing.
However, according to Investopedia . com, the most likely reason for the Santa Claus rally is an increase in share purchases made to escape paying the higher stock prices expected in the new year. A surge in stock prices early in the year is known as the January effect.
Santa Claus rally
A Santa Claus rally is a rise in stock prices in the month of December, generally seen over the final week of trading prior to the new year. The rally is generally attributed to anticipation of the January effect, an injection of additional funds into the market, and to additional trades which must, for accounting and tax reasons, be completed by the end of the year. Another reason for the rally may be fund managers "window dressing" their holdings with stocks that have performed well.
The Santa Claus rally is also known as the "December Effect" and was first recorded by Yale Hirsch in his Stock Traders Almanac in 1972.