All Financial Wisdom

Talking to the Uncle

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Over this past week, I had a long conversation with one of my uncles about momentum investing. I have done my research prior to this but now I am trying to learn more about momentum investing as a successful investing strategy for one of portfolios I am managing.

I am currently in the works of putting together a more detailed post outlining what momentum investing is and how to do it.

I am also going to try to put together a Google Drive worksheet showing how I am computing my winners (stocks that I will buy positions in) and losers (stocks that I will sell my positions in, if any). I will generate my list of stocks out of an index such as the S&P 500 or the Russell 2000 and then compute their 6-month price momentum. I would choose the top 5 for now, selecting them as the “winners” and put them aside to track further. After purchasing positions into these winners, I will track them until they are not in the top 15 anymore and sell them. With an influx of cash or selling of a position, I will select another top 5 and purchase it, repeating the process.

I have some more thinking and planning on executing this, but this is what I am at at the moment.

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