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Investment Strategy

And the Last Shall be First

By Roger S. Conrad, on Dec. 28, 2016

Late December is tax-selling season. Investors dump their losing stocks and write off the red ink against gains taken on winners. This ritual frequently further drives down prices of stocks that already have had tough years.

But there’s often a silver lining for those who hold on to battered stocks, at least when the underlying business is still sound: Bargain hunters come out once tax selling has run its course. Accordingly, one year’s underperformers sometimes emerge as the next year’s leaders.

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