I would like to start a little experiment: I normally avoid individual stocks as I don't have the expertise to successfully deal with fundamental analysis.
However, as I still want to profit from stocks with strong momentum, I have come up with the following rule:
- About 30 stocks that have strong momentum right now (e.g. >20% over one month & >30% over three months) are bought, larger market cap is preferred.
As a hedge:
- If a stock falls below its 50d-EMA (Exponential Moving Average), the respective capital is shifted back into cash.
Fundamental data is deliberately ignored here, only momentum is taken into account in order to keep the whole thing as simple as possible. What do you think? Especially @Tenbagger2024 from whose posts I got the inspiration for this.