Glossary

Momentum investing is an investment strategy that involves buying securities that have recently experienced strong price performance and selling those with weak performance.

The idea behind this approach is that stocks with upward price momentum will continue to rise while those with downward momentum will keep falling. 📈🔄

An example of momentum investing would be purchasing shares of a tech company that has consistently outperformed the market over the past several months, in the expectation that the trend will continue.

Fun fact: Momentum investing is often associated with the famous saying, "The trend is your friend," which highlights the importance of following the market's direction when making investment decisions. However, critics argue that momentum investing can be risky, as trends may reverse unexpectedly, leading to losses. 😮💰