Momentum | August 8, 2017

Category: Quantitative Insights

As the Dow Jones broke records, tech-related markets slowed down slightly. This may just be a single data point but when markets are not synchronous in their growth, it tends to indicate a change in leadership. We think it may be important to keep an eye on the growth patterns going forward.

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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