Introduction
Momentum trading is far from a fleeting trend—it is a robust strategy backed by thorough academic research and empirical evidence. Top hedge funds have long relied on these techniques to drive profitability and manage risk.
Academic Foundation
Renowned researchers like Pedro Barroso and Pedro Santa-Clara have rigorously analyzed momentum effects, challenging traditional market theories such as the Efficient Market Hypothesis (EMH). Their studies show that a disciplined momentum approach can generate superior returns.
- Extensive peer-reviewed academic studies
- Proven analysis that challenges conventional market assumptions
- Solid theoretical support for long-term profitability
Empirical Evidence
With over 854 articles citing the influential study “Momentum has its moments” on Google Scholar, empirical data confirms that momentum trading is not speculative—it is a strategy that works in real-world markets.
Behavioral Finance Impact
The strategy capitalizes on behavioral biases like herding, overreaction, and underreaction to news, exploiting these psychological patterns to create persistent trading opportunities.
Global Reach and Evolution
Momentum effects are observed across markets and asset classes worldwide. As market dynamics shift, continual technological advancements in data analysis and risk management ensure that momentum strategies remain effective and adaptive.
How to Get Started
Traders can begin their journey by exploring the exclusive momentum‐based Expert Advisor available through EasyAlgos AI. With a simplified sign-up process by Valery Trading, you can complete onboarding in five minutes or less and integrate this dynamic trading tool into your portfolio.