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Momentum ETFs Soar to New Highs

Neena Mishra
Sempra Energy (SRE) has surpassed the Zacks Consensus Estimate in two out of the last four quarters with an average positive beat of 2.75%.

Investors love hottest stocks and continue to pour money into them. While the popular finance theory “random walk” suggests that the past movement of the price of a stock cannot be used to predict its future movement, history shows that recent past performance can be a pretty good predictor of short-term future performance. 

Momentum effect, which refers to the tendency of winning stocks to keep winning, has been documented in many academic studies. Enthusiastic investors chase high fliers, even ignoring fundamentals at times.

There are a number of ETFs available to investors to ride these trends. These ETFs have done pretty well this year as stocks continue to rise thanks to the booming economy, tax cuts and excellent earnings reports.

To learn about the iShares MSCI USA Momentum Factor ETF (MTUM), the First Trust Dorsey Wright Focus 5 ETF (FV) and the PowerShares DWA Momentum ETF (PDP), please watch the short video above.

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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
 
Microsoft Corporation (MSFT) : Free Stock Analysis Report
 
PWRSH-DWA MO PO (PDP): ETF Research Reports
 
ISHRS-MSCI US M (MTUM): ETF Research Reports
 
FT-DORSEY WFFF (FV): ETF Research Reports
 
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