Momentum

Category: Quant Insight

Short-term momentum for stocks, especially EM stocks, continues to grow. Energy and metals also show positive momentum. All of this combined with higher rates appear to point to a return of the reflation theme that dominated the early part of 2017.

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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