| Kippreport.com

Business of… investment tips

November 8, 2010 11:43 by Katherine Azmeh

Chasing performance. We’ve been taught not to jump on the bandwagon of a stock whose share price is increasing. For example, after reading about the skyrocketing price of Apple stock for months, we jump in the game just as Apple shares near their all time high. It’s called “momentum investing,” and it’s gotten a bad rap.  But a new study suggests that “top performing stocks over three to 12 month periods continued to outperform, on the average, over the following three to 12 months,” Money reported. The same is true for stocks headed southward, they say. Prudent advice is to use “momentum investing” as one strategy in your arsenal. Along with a more conservative backdrop, it can make sense.

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Tags: chasing performance, commodities, equities, fundamental indexes, index fund investing, index funds, leverage, lump sum investing, momentum investing, money magazine, savings, share prices, stocks, unconventional investment advice