Yahoo Finance Zacks.com featured highlights include: The Clorox Company, West Pharmaceutical Services and Everbridge
For Immediate Release
Chicago, IL – June 9, 2020 – Stocks in this week’s article are The Clorox Company CLX, West Pharmaceutical Services, Inc. WST and Everbridge, Inc. EVBG.
Top 3 Momentum Anomaly Stocks to Consider on Investor Optimism
Wall Street seems to have celebrated on Jun 5 after a surprising surge in U.S. jobs raised optimism that the economy is recovering from the COVID-19 pandemic. Economists had been looking for the highest unemployment rate since the Great Depression but the United States saw its biggest one-month job gain ever.
Employers added 2.5 million jobs last month while the unemployment rate dropped to 13.3%. The report rekindled hope of a swift economic recovery among investors, leading them into stocks that would benefit from a well-aligned reopening. The Dow moved up 3.1% closing at 27,110.98 on Friday. Meanwhile, the S&P rose 2.6% to 3,193.93 and the tech-heavy Nasdaq advanced 2% to 9,814.08.
Amid a global economic downturn that is anticipated to see second-quarter GDP fall of at least 40%, with nearly 21 million people still unemployed, the market has been quite resilient. Reacting hastily to volatile trends can cause more damage to an investor’s portfolio returns than a downturn. When value or growth investing fails to fetch sustained profits, one should explore another time-tested winning strategy that simply bets on the frontrunner stocks. This is known as momentum investing.
At the core, momentum investing is buying high, selling higher. It is based on the idea that once a stock establishes a trend, it is likely to continue in that direction. There’s a whole list of behavioral biases that most investors exhibit. For instance, some investors are anxious about booking losses and hence hold on to losing stocks for too long, hoping for a rebound in prices.
Meanwhile, a few investors sell their winners way too early. Momentum investing is one of the best strategies to avoid making such mistakes. So, it’s a way to profit from the general human tendency to extrapolate current trends into the future. Thus, momentum investing is based on that gap in time, which exists before the mean reversion occurs i.e. before prices become rational again.
Here, we have created a strategy that will help investors get in on these fast movers when there is a short-term pullback in price and rake in handsome gains.
For the rest of this Screen of the Week article please visit Zacks.com at:https://www.zacks.com/stock/news/971154/top-3-momentum-anomaly-stocks-to-consider-on-investor-optimism
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The Clorox Company (CLX) : Free Stock Analysis Report
West Pharmaceutical Services, Inc. (WST) : Free Stock Analysis Report
Everbridge, Inc. (EVBG) : Free Stock Analysis Report
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