Relative Strength: A Solid Investment Method
We are fond of relative strength. It’s a solid investment method that have proven itself over a long period of time. Sure, it has its challenges and there are certainly periods of time during which...
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86 Years of High Relative Strength
Ken French’s database is an unparalleled and *free* source of all types of stock market data. We’ve used this database to track high relative strength performance versus the broad market, other...
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Relative Strength Turns
Our partners at Arrow Funds have recently published some relative strength research that should be essential reading for any advisor who is looking to provide value to their clients. Relative Strength...
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Emerging Markets ETFs
Morningstar came out with a piece yesterday titled Are There Better Emerging-Markets ETF Choices? The article discussed the availability of alternative beta funds in the area, and had this to say, in...
View ArticleThe Capitalism Distribution
Why relative strength? Longboard Asset Management completed a study called The Capitalism Distribution that examined stock returns from the top 3000 stocks from 1983-2007. They found that: -39% of...
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Momentum: “A Powerful Way To Enhance Returns”
Morningstar does a pretty deep dive into momentum in their article Does Momentum Investing Work? I highly recommend reading the whole article as it covers some excellent long-term studies of momentum....
View ArticleThe Wonders of Momentum
Relative strength investors will be glad to know that James Picerno’s Capital Spectator blog has an article on the wonders of momentum. He discusses the momentum “anomaly” and its history briefly:...
View ArticleFrom the Archives: Perfect Sector Rotation
CXO Advisory has a very interesting blog piece on this topic. They review an academic paper that looks at the way conventional sector rotation is done. Typically, various industry sectors are...
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From the Archives: If You Miss the 10 Best Days
We’ve all seen numerous studies that purport to show how passive investing is the way to go because you don’t want to be out of the market for the 10 best days. No one ever mentions that the “best...
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DWTFX Tops Peers
Earlier this year, we featured an excellent resource published by our partners at Arrow Funds called Relative Strength Turns. You can access a PDF of the brochure by clicking here. This research...
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Academic Perspective on Momentum-Based Investing Webinar
Come listen to an academic perspectives as to why momentum-based investing makes sense, and how you may be able to take advantage of it, from one of the pioneers in momentum and relative strength...
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Alternative Beta
…has been discovered by the Wall Street Journal. Recently, they wrote an article about better ways to index—alternative beta—and referenced a study by Cass Business School. (We wrote about this study...
View ArticleHow to Pick a Winner
Scientific American takes a look at the best way to select a winner: Given the prevalence of betting and the money at stake, it is worth considering how we pick sides. What is the best method for...
View Article212 Years of Price Momentum
Christopher Geczy, University of Pennsylvania, and Mikhail Samonov, Octoquant.com, recently published the world’s longest backtest on momentum (1801 – 2012). This is a truly fascinating white paper....
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Relative Strength Spread
The chart below is the spread between the relative strength leaders and relative strength laggards (universe of mid and large cap stocks). When the chart is rising, relative strength leaders are...
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Factor Performance and Factor Failure
Advisor Perspectives recently carried an article by Michael Nairne of Tacita Capital about factor investing. The article discussed a number of aspects of factor investing, including factor performance...
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Relative Strength Environments
What market environments are best for relative strength strategies? Our partners at Arrow Funds recently completed a nice research piece that addresses that question. The essential factors are...
View ArticleFrom the Archives: Mebane Faber’s New White Paper on Relative Strength
Mebane Faber recently released a nice white paper, Relative Strength Strategies for Investing, in which he tested relative strength models consisting of US equity sectors from 1926-2009. He also...
View ArticleThe Case for Systematic Decision-Making
From Wes Gray comes an excellent video about expert decision making versus model-based decision making. Well worth the 17 minutes.
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Momentum Coming of Age
We’ve come a long way from the days of ”Wall Street is a random walk, and past price movements tell you nothing about the future,” as advocated by Efficient Market Hypothesis (EMH) proponents Burton...
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