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What is Momentum Investing?

Momentum investors usually have their own models for determining whether they think a price trend (to the upside or downside) is set to continue - sometimes it’s looking at a 3 month trend, sometimes a few weeks, sometimes even longer.

The idea is that once a trend is established, an investor can buy into its continuance (if its an upward trend), or sell into (or sell short) if it is an established downward trend. Momentum investing is by no means a proven method, but sophisticated investors will try to use models to increase their probabilities of success.

Is There Any Merit to the Momentum Theories?
What is Trend Analysis?

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