Using Momentum Investing and Trend Following

How momentum investing works, what are some of the challenges in implementing it, and how can individuals use momentum in their investment portfolios.

Topics covered in this episode include:

• What is momentum investing and why does it theoretically deliver excess return.
• Why do momentum strategies suffer through periods of horrendous losses.
• Why high trading costs and selling a position can be challenges to successfully implementing momentum strategies.
• What are examples of momentum oriented funds and ETFs.
• How momentum can be used for making asset allocation decisions and adjusting portfolio risk.

Thanks to The Great Courses Plus and Netsuite for sponsoring the episode.

For show notes and more information on this episode click here.

• [0:18] Momentum investing consistently outperforms the market.
• [5:04] Why does momentum investing work?
• [7:31] The three challenges of the momentum investing phenomena.
• [12:50] What happens if investor behavior changes?
• [14:24] Tactics for implementing momentum into your own portfolio.
• [20:02] Using dual momentum to move in and out of asset classes.
• [23:55] Utilizing momentum investing as a swing vote.
• [28:01] How David uses momentum investing in his portfolio.

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