5/12/10
Podcast #4 Momentum is Here to Stay
Mike Moody and Andy Hyer discuss the following provocative statement by Abnormal Returns in their 5/10/10 post The Momentum Paradox:
All that being said, momentum remains a paradox. Momentum is easily calculated and widely disseminated. It is hard to believe that momentum strategies would continue to outperform in that sort of environment. However, to-date they have. So much so, that academia and practitioners alike recognize it as a return factor.
Will this momentum era end at some point? Maybe. The construction of momentum indices might lead to its eventual demise. In the meantime investors of all stripes need to take note of momentum in designing their approach to the markets.
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