Category: Momentum Relative Strength
-
Trends, Countertrends, in the U.S. Dollar, Gold, Currencies
Trend is a direction that something is moving, developing, evolving, or changing. A trend is a directional drift, one way or another. When I speak of price trends, the directional drift of a price trend… Read More
-
Diversification Alone is No Longer Sufficient to Temper Risk…
That was the lesson you learned the last time stocks became overvalued and the stock market entered into a bear market. In a Kiplinger article by Fred W. Frailey interviewed Mohamed El-Erian, the PIMCO’s boss,… Read More
-
Sectors Showing Some Divergence…
So far, U.S. sector directional price trends are showing some divergence in 2015. Rather than all things rising, such divergence may give hints to new return drivers unfolding as well as opportunity for directional trend… Read More
-
“There is always a disposition in people’s minds to think that existing conditions will be permanent …
“There is always a disposition in people’s minds to think the existing conditions will be permanent,” Dow wrote, and went on to say: “When the market is down and dull, it is hard to make… Read More
-
Small vs. Large Stocks: A Tale of Two Markets (Continued)
A quick follow up to my recent comments about the down trend in smaller company stocks in Playing with Relative Strength and Stock Market Peak? A Tale of Two Markets below is a chart and a few… Read More
-
Trend Change in Dollar, International Stocks, Gold?
Directional trends tend to persist. When a price is trending, it’s more likely to continue than to reverse. A directional trend is a drift up or down. For example, we can simply define a uptrend… Read More
-
Playing with Relative Strength
I discussed in my interview with Investor’s Business Daily in 2011 titled “How Mike Shell Uses Relative Strength To Trade ETFs” some very basic concepts of how I apply proprietary relative strength systems to ETFs… Read More
-
Fact, Fiction and Momentum Investing
Abstract It’s been over 20 years since the academic discovery of momentum investing (Jegadeesh and Titman (1993), Asness (1994)), yet much confusion and debate remains regarding its efficacy and its use as a practical investment… Read More
-
Asymmetric Risks of Momentum Strategies
Asymmetric Risks of Momentum Strategies is another attempt to explain the excess returns of momentum using the Capital Asset Pricing Model. The paper discusses a theory of risk asymmetry in momentum risk/reward, but not how… Read More
-
Adapting to Change… and Volatility
High relative strength stocks have always had the potential to gap down just as they may gap up. High momentum is sometimes joined by high volatility. I have observed several changes in trend behavior and… Read More