#DUAL MOMENTUM INVESTING PDF PROFESSIONAL#

Doing the sum of these three time segments lets us also take into account the curve of the trend. This momentum score is the sum of each asset’s 1 month, 3-month, and 6-month returns. Compute an accelerating momentum score of US and international stocks, specifically small-cap ex-US stocks for the added correlation benefit. So here’s a table of contents to let you traverse this a bit better. This post got a bit out of hand… over 5,000 words. No proprietary software necessary, no expensive financial advisor required – just you, some logic, and systematic rules-based investing ( no emotion!). I’ll also provide tools you can use to implement this, or a similar strategy, on your own for free. I will provide all the data used so that you can perform your own analysis. In this post, I will lay out the framework of a simple, intuitive and profitable strategy that has worked well over the last 150 years.

We don’t hope or expect to be right every time, but we do hope and expect this strategy to do a decent job at minimizing losses to improve the effect of compounding gains.

#DUAL MOMENTUM INVESTING PDF PROFESSIONAL#

To even consider a market timing strategy is generally frowned upon by professional investors.īut we’re not professional investors, we’re just engineers who were convinced that there must be a simple yet effective way to pick up on and follow trends in uncorrelated asset classes. Market timing is hard, if not impossible to do, as it often results in the investor buying or selling too late or too early rather than right on time. Warren Buffett has said that trying to time the market is the number one mistake to avoid.

Dual momentum investing pdf