First five days: an investment myth to ignore

This New Year indicator holds that the first five days of January can predict the direction of the market for the rest of the year. It's popular - but completely useless.

Happy New Year. With this being the first issue of 2007, we're going to do a little myth-busting today - alerting you to one dangerous indicator that just doesn't indicate what it's supposed to.

It's human nature to reduce complex systems to simple terms. We're often willing to believe cause-and-effect explanations that really don't make logical sense.

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MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.