Momentum

Category: Quant Insight

Long-term momentum for stocks is still positive across the board, but short-term momentum is still quite flat save for the U.S. We believe the lack of decisive momentum is likely a contributor to the sideways movement in the stocks over the past several weeks.

Momentum measures the rate of acceleration, either positive or negative, in a security’s price and may indicate which markets are positioned for gains or losses. Investing based on momentum entails establishing long positions in securities with positive recent returns and short positions in those with negative recent returns. Momentum in asset classes may illustrate the development of trends in the market.

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