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Earnings Momentum
Definition
A growth investment / trading style that focuses on locating companies that exhibit high quarter to quarter (and year over year) growth in earnings.
Using the term Earnings Momentum :
Gene trades an earnings momentum style when the markets are doing very well. He rides a stock until he believes that the growth rate of earnings will subside and then he sells his position.
Pay Special Attention To :
Trading in this style can be dangerous. Never forget that the stock market is a discounting mechanism and as soon as the market senses that earnings momentum may slow down, the stock will suffer quickly and in large orders of magnitude.
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Related terms
Trading , Trading Styles , Investment Analysis
