'SHMOmemtum'

The definition of ‘SHMOmentum’ is the market of the last few weeks.

Momentum investors that do not have exit plans become these SHMOmentum investors, talking to themselves about ‘oversold’ bounces and 200 day averages.

Momentum investing is really hard.  You are overpaying for stocks for their liquidity and institutional support.

If you sell when the just as scared instuituitional investors start with their shmomentum selling, you will find 10 percent losses become 30-40 percent losses in just a few days.

It is why when you momentum invest you don’t own 30 stocks, you own 6-10 and you keep your losses small.

Trust me that it is easier said than done.  One look at the stock and currency markets tell the story.

9 comments

  1. JasonRaznick says:

    following trends are important, but where your book helped me the most was with money mgmt. Previously, this fall in the mkt may have been very bad for me, it may have taken years, but now the diversified approach is ingrained into my investment strategy. i have 30% cash, 30% stocks/etfs, 20% angel investments, 20% sadly real estate, but there is cash flow there although not much resale value.

  2. JasonRaznick says:

    following trends are important, but where your book helped me the most was with money mgmt. Previously, this fall in the mkt may have been very bad for me, it may have taken years, but now the diversified approach is ingrained into my investment strategy. i have 30% cash, 30% stocks/etfs, 20% angel investments, 20% sadly real estate, but there is cash flow there although not much resale value.

  3. Dave Pinsen says:

    One point O’Neil made in his book on short selling is how the liquidity and institutional sponsorship can work to your advantage when shorting. I’ve been bearing that in mind when shorting recently.

  4. Dave Pinsen says:

    One point O'Neil made in his book on short selling is how the liquidity and institutional sponsorship can work to your advantage when shorting. I've been bearing that in mind when shorting recently.

  5. jonn2 says:

    comment4, victorian england games, =))), video age minnesota, >:-DD, video baby monitors svat, :-))),

  6. tiffney says:

    I think market is the best . and i will go market and i will bring a lot of things . and …… but we are not going to market mooch around .my friend go to market and that day go to market these brings a lot of things.
    ————————————————
    daniel
    Cheap Investors

  7. Haven jack says:

    I appreciate the concern which is been rose. The things need to be sorted out because it is about the individual but it can be with everyone.
    =================================
    Cheap Investors

  8. danielnorth01 says:

    I think market is the best . and i will go market and i will bring a lot of things . and …… but we are not going to market mooch around .my friend go to market and that day go to market these brings a lot of things.
    ————————————————
    daniel
    Cheap Investors

  9. Haven jack says:

    I appreciate the concern which is been rose. The things need to be sorted out because it is about the individual but it can be with everyone.
    =================================
    Cheap Investors

Comments are closed.