Which of the following statements regarding momentum strategies is true?

Question

Quizplus · Accepted Answer

Price momentum and earnings momentum are both types of quantitative investment strategies. Price momentum involves buying stocks that have been going up in price over a certain period of time, while earnings momentum involves buying stocks that have had positive earnings surprises or upward earnings revisions. Earnings momentum is typically considered a fundamental strategy, as it is based on changes in a company's financial performance. Price momentum, on the other hand, is often considered a technical strategy, as it is based on changes in a stock's price chart. While there may be some overlap between the two strategies, it is unlikely that they will result in identical portfolios or holdings. Therefore, statement C is false. Statement D is true, as the earnings momentum strategy involves buying stocks for companies that have positive earnings surprises or upward earnings revisions. Therefore, the correct answer is D.

Which of the Following Statements Regarding Momentum Strategies Is true