Trends Are Everywhere

March 8, 2010

Acorn Investments’ Jason Russell writes:

Trends are everywhere - weather, sports, fashion, food, entertainment, health, science and politics. Some trends are long, some are short. They come and they go as they always have and always will. Life and business both thrive on identifying, following and serving trends. Market prices for metals, currencies, energies or bonds are no different.

This is why we are never very concerned when markets are trendless for a while. New trends come and go all the time, and our Systematic RS process is designed to identify the strongest trends and to latch on to them. The trends that continue for a long period of time can be very profitable.

via www.MichaelCovel.com

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Posted by Mike Moody

Weekly RS Recap

March 8, 2010

The table below shows the performance of a universe of mid and large cap U.S. equities, broken down by relative strength decile and quartile and then compared to the universe return. Those at the top of the ranks are those stocks which have the best intermediate-term relative strength. Relative strength strategies buy securities that have strong intermediate-term relative strength and hold them as long as they remain strong.

Last week’s performance (3/1/10 – 3/5/10) is as follows:

That is my kind of week - great performance for the broad market and even better performance for high relative strength stocks! Now, if I annualized that performance…

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Posted by JP Lee