5 Stocks for the January Effect

Stock #1: Frontier Financial Corp. (FTBK)

If the January effect is a result of tax-loss selling, where better to look for
stocks being sold due to losses than the banking sector? Money managers and individual
investors have taken a bath on bank stocks. While the credit crisis is far from
over, owning a bank stock in anticipation of a first month of the year rally makes
sense to me.

One name that has been obliterated in 2008 is Frontier Financial Corp. ( href="http://studio-5.financialcontent.com/investplace/quote?Symbol=FTBK">FTBK).
I had recommended to my newsletter subscribers that they short this stock back in
2005 when it traded for $20 per share. Now you can buy the stock for less than $4
per share. Just recently the company announced that it was suspending its dividend
to preserve cash. That caused some serious tax-loss selling. I would use the opportunity
to buy.

Next:
Stock #2 – Parker Drilling (PKD)