MOMENTUM INVESTING
Focus: Momentum Investing
Source: Finbold
Understanding Momentum Investing:
- Definition: Unlike traditional advice to buy low, momentum investing involves buying assets with rising prices and selling falling ones.
- Contrasting Tradition: Strategy aiming to profit from ongoing market trends.
- Involves buying rising securities and selling at perceived peaks.
- Trends Recognition: Based on the belief that discernible trends persist, allowing investors to recognize and participate early for significant profits.
Counter-Logic
- Traditional Wisdom: Traditional advice encourages buying undervalued assets during crises for later profit. Momentum investing’s “buy high, sell higher” contrasts this.
Key Term:
Momentum: Refers to a price trend’s ability to sustain and persist in the future. |