Momentum stocks: the ten strongest of the year
Buy the stocks that rose most over the past year and replace them every month. The classic 12-1 momentum.
The rule
Rank large stocks by their return over the last twelve months, leaving out the most recent month. Hold the top ten in equal parts.
Why people use it
Winners tend to keep winning for some months: news is absorbed slowly and investors pile into what already rose. The effect has been documented since the 1990s in most markets.
Where it hurts
Momentum crashes: when the market turns, last year's winners often fall hardest. Ten stocks is a concentrated bet, and the monthly turnover is high.
How our bot runs it
The bot chooses from the hundred largest US companies (the S&P 100 list as it is today). The score is the return from 12 months ago to one month ago. Ten stocks at 10% each, reviewed monthly.
Live account
A virtual $100,000 account that follows this rule. Every trade is on the bot's page.
| Bot | Account | Return |
|---|---|---|
| Ten strongest stocks | $99,112 | −0.89% |