For Immediate Release
Chicago, IL – December 13, 2021 – Stocks in this week’s article are Gartner, Inc. (
IT Quick Quote IT - Free Report) , Robert Half International, Inc. ( RHI Quick Quote RHI - Free Report) , and Dillard’s, Inc. ( DDS Quick Quote DDS - Free Report) . Buy These 3 Stocks with Momentum Anomalies for Higher Returns
When value or growth investing fails to fetch sustained profits, one should explore another time-tested winning strategy that bets on frontrunner stocks. One of the most successful strategies in this day and age is to get in on momentum stocks at the right time.
We’ve all heard the adage, “the trend is your friend”. At the core, momentum investing is “buying high and selling higher.” It is based on the idea that once a stock establishes a trend; it is more likely to continue in that direction (than move against the drift) because of the momentum that is already behind it. But why does the momentum strategy work?
Well, there are several behavioral biases that most investors exhibit in their decision-making. And these emotional responses, or rather mistakes, are the very reason that makes momentum strategy work.
For instance, some investors are anxious about booking losses and hence hold on to losing stocks for too long, hopeful of a rebound in prices. On the other hand, a few investors sell their winners way too early. Momentum investing is one of the best strategies to avoid making such errors in judgment.
Furthermore, investors initially tend to underreact to news, events or data releases. However, once things become clear, they have a habit of going with the flow and overreacting, causing dramatic price reactions. These behavioral problems extend trends, thus opening up huge opportunities for momentum players.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1837796/buy-these-3-stocks-with-momentum-anomaly-for-higher-returns Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
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Contact: Jim Giaquinto
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