By Justin Carbonneau (@jjcarbonneau) At the most basic level, momentum investing in the context of security selection can be defined as buying securities that have done the best over the…
Tag: Momentum Investing
Study Claims That the Momentum Factor Doesn't Work
A new study from Dimensional Fund Advisors concludes that fund managers “can’t find a way to profit” from the momentum factor, according to an article in Institutional Investor. The study,…
Does Mutual Fund Performance-Chasing Deserve its Bad Reputation?
A recent CFA Institute article discusses mutual fund performance-chasing which it says has drawn criticism. To evaluate how performance-chasing is faring in the U.S., the CFA Institute replicated momentum investing…
Considerations in Momentum Investing
By Justin J. Carbonneau (@jjcarbonneau) — About a week ago CNBC had a piece that broke down how much the largest, best performing stocks have contributed to the overall market’s…
Momentum Investing Works Until it Doesn’t
A recent article in InvestmentNews highlights how momentum investing—buying shares of whatever is rising the fastest and selling when these stocks “lose steam”–has been performing well of late. However, the…
Hulbert Says Momentum Investing Lives
There are still good reasons for investors to pursue a momentum strategy, writes Mark Hulbert in a recent Wall Street Journal article. He offers data collected by Eugene Fama (University…
Morningstar Compares Research Data to Real-World Investing
There is an abundance of research data regarding how investors can maximize returns, but it doesn’t necessarily translate into real-world results, according to a recent Morningstar article. Alex Bryan, Morningstar’s…
Adding Momentum to Your Portfolio
The tendency of recent market performance to persist, an effect known as momentum, has been pervasive even though it is a “blatant violation” of what you would expect in an…
Momentum Investing is Back, At Least for Now
The strategy of buying whatever sector has had the greatest price or earnings gains in the past twelve months seems to have come back in fashion, according to a recent…
The Payoff and Perils of Momentum-based Stocks
Many investors follow momentum-based methods or approaches when investing in equities, but does momentum investing actually work and what are the results? This is the basis for a recent AAII…