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January shouldn't chill stock market gains

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Even as stocks exit 2013 at record levels and with stellar gains, it is likely the "January effect" will help spur further advances.

The was up nearly 30 percent for 2013, its best yearly performance since 1997, and traders expect to see stocks get a lift in early January as investors reposition.

"It's the idea that new money comes into the market, investors see a big up year and it gets people excited," said Paul Hickey, co-founder of Bespoke.

"January has historically been a really good month for the market, but in more recent years it hasn't been that positive ... so you can make the argument that it is anticipated in December," Hickey said. The S&P 500 has been up 13 of the last 20 Januarys, and the small-cap Russell 2000—also viewed as a beneficiary of the January effect—was up just nine of those. But the Russell outperformed the S&P in eight of those years.