Core Insights - Investors are increasingly focused on tax optimization strategies as the year-end approaches, leading to potential selling of underperforming stocks [1][2] - The theory posits that stocks with significant losses would experience heightened selling pressure, resulting in underperformance [2][3] Performance Analysis - In 2022, stocks down 25% or more as of mid-November showed an average decline for the rest of the year, with only 46% of these stocks posting positive returns [4] - Conversely, stocks that had gained 10% or more by mid-November were the next worst performers, averaging a return of 0.74% with less than half achieving positive returns [4][5] - In 2022, despite the overall negative trend, the most beaten stocks outperformed, averaging a return of 3.4%, with 44% of these stocks posting positive returns compared to 28% of all stocks [6][8] Yearly Comparison - The analysis of 2023 revealed that the most beaten stocks through mid-November outperformed for the remainder of the year, contradicting the initial theory [8] - Only in 2022 did beaten down stocks underperform, coinciding with a higher number of stocks down at least 25% by mid-November [8]