At the upcoming turn of the year, the launch of the equity savings account might affect tax-loss harvesting and the January rally.
Which stocks are you expecting to be discounted by year-end tax-loss harvesting?
Which stocks are you following with a view to buying, awaiting a possible January rally?
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For the rest of the year, I’m looking at cyclical stocks and a few turnaround cases that have shown recovery this year but might still take a hit. Additionally, I’m keeping an eye on quality companies I’ve been tracking for a while, which I might be able to get a bit cheaper.
Cyclical: Forest companies (UPM, Stora), Engineering companies (Wärtsilä, Valmet)
Turnaround: Glaston, Exel
Quality: Kone, Ponsse, Marimekko, Talenom, Revenio, Neste
With the January rally, I hope to get rid of a few bottom-of-the-portfolio cases that I think have upward pressure. But there’s no urgent need to sell. I’m planning to transfer any proceeds from potential sales to an equity savings account.
For sale: Nordea and Sampo (maybe)
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I’m eyeing Kamux for an add, but I’m pessimistic about success. The January rally has been so much in the media that I doubt the phenomenon will occur this year.
And if I had to guess which stock will dip, it’s Lehto. There’s a lot of tax receivables there, which could be relatively very high compared to a potential loss from sales. Many want to sell, but no one wants to buy. When you mention the company on this forum, the first reaction to buying is 
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Tax sales typically hit small “junk companies” the hardest. This is probably the case this year too, but then again, many widely-owned large companies (Nokia, Nordea, etc.) have probably already offered tax selling opportunities. For smaller companies, the additional burden on the stock price (more than for large companies, I think) could be individual large owners divesting their holdings as part of November-December clearance sales. I could be wrong, but I have observed some large sales at the end of the year, more often than at other times on average.
I myself am prepared to buy one or two companies that are on sale. I haven’t really explored the options yet, but the goal would be to buy something I don’t already own. Privanet was the first company that came to mind, which is probably under pressure regardless of the season. And it doesn’t seem like a suitable target for me.
The January rally is usually strongest, especially for small companies, particularly those that are oversold. However, would the OST (dividend stock account) affect dividend stocks more, if those are mainly acquired for the account?
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I’d guess that the January rally will be stronger this year than in previous years due to the introduction of equity savings accounts.
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Perhaps there’s also a bit of a misconception that “everyone” would know about the existence of the phenomenon and therefore the phenomenon would weaken or disappear. I believe that the phenomenon is not yet sufficiently known outside of investment nerd circles.
In my opinion, no one needs to sell before January because of the equity savings account; the sale can happen in January or February, and there’s still time to transfer dividends to the equity savings account. Secondly, some operators haven’t even finished their equity savings accounts by January. Many might still be considering where to open an account, and it’s good to think about it, as you can only have one operator. I suspect the equity savings account will cause an unusually large “dividend frenzy,” which I think is a different matter. The peak of the rise will then be in March-April.
I agree that sales will come, if at all, to “junk companies” that funds don’t want to show prominently in their content reports at the turn of the year, at least not with a high weighting. When liquidity is low, these will then fall sharply.
Nokia is indeed an interesting case. Few funds probably want to show a large exposure to Nokia at the turn of the year. Similarly, its market value has fallen sharply => Lower weighting in various indices, and it might even drop out of some. There are drivers for it to go down. It doesn’t pay dividends, no money for the state, Solidium is pressured to dump it. A delicious short case.
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Good candidates have emerged here.
My own thought was to wait and see if Fondia would drop below eight.
Perhaps partly due to the Inderes effect, the direction and slope of the share price have been completely wrong for the plan. Or rather, premature, as I didn’t get in on time 
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The tax sale roulette is already spinning.
“Place your bets, please.”
Soon you’ll hear: “No more bets.”
Bringing this up since it’s so quiet 
The quietness is partly due to the fact that, as in previous years, I haven’t come across any attractive dips.
Maybe on Monday?
How about others?
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Nothing much… Except for Rapala a week ago. This was more about a single seller setup, maybe not so much tax-loss selling.
I’ve been following Fiskars, but no excessive selling has been seen there either.
Otherwise, it’s somehow difficult to see any major tax-loss selling. Investors’ self-confidence is at its peak, and they’re chasing returns from sure “January rally” targets.
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I also bought Rapala when it was under 2.60, and Fiskars is under observation.
I’ve seen a small dip in Basware and Incap, which smells a bit like tax loss selling. Both are currently well below their yearly highs, so there are certainly people with shares at a loss. But we’re talking about movements of a couple of percent…
Let’s put a couple of things from Twitter here too.
Based on a survey, the share savings account will affect the January rally:
Usually, the biggest losers during the year (especially low-volume ones) see strong gains in January:
In addition to these, at least Rovio, Nordic ID, Rush Factory, and Nexstim are on my list.
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In my Twitter bubble, there’s been a good debate about the January Rally, OST effect, etc.
This tweet from @ContraCapital really hit home for me 
https://twitter.com/Contra__Capital/status/1211663658356490247
Seriously though, during the holidays I was thinking, “I wish the stock market would open so I could make some money…” Then it occurred to me that a year ago, at the same time, I thought, “I wish HEX would stay closed for at least another week because the US stock market was glowing red like Santa’s hat.”
Now I’ve reduced my risks, even though I have some ideas in play, but nowhere near the weight I was considering.
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I’ve also got a bit of a bad feeling about January. It feels like the mood is too positive right now
Could it be that the Santa Claus rally replaced the January rally this time…
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An estimated 60-70k new OST accounts are coming online the day after tomorrow, and something should be entered into all of them. It must show up somewhere.
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Yeah, I guess my January purchases will be moved to later due to this new December phenomenon.
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Has anyone calculated what class that OST volume could be in relation to the total turnover in euros in January?
Remember that only those genuinely interested in investing are on these forums. The large masses know little about the January effect, or those who think they do will buy in the first few days, thinking they’re the first to the carcass.
Of course, the worst would be some Trumpeting tomorrow that crashes the markets; in that case, one purchase wouldn’t mean much.
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