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Momentum and industry growth

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  • Assem Safieddine
  • Ramana Sonti

Abstract

In this paper, we find that individual stock momentum varies almost monotonically with industry growth. Firms in the highest industry growth quintile have significantly higher momentum compared to those in the lowest growth quintile. We find that the above‐average growth group within each quintile has significantly higher momentum profits than the below‐average group. Further, momentum profits of the highest industry growth quintile are always higher than those for the universe of firms, suggesting an economic benefit to stratifying firms based on industry growth and relative company growth intra‐industry, while following a momentum investment strategy.

Suggested Citation

  • Assem Safieddine & Ramana Sonti, 2007. "Momentum and industry growth," Review of Financial Economics, John Wiley & Sons, vol. 16(2), pages 203-215.
    • Handle: RePEc:wly:revfec:v:16:y:2007:i:2:p:203-215
    DOI: 10.1016/j.rfe.2006.01.003
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    References listed on IDEAS

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    Cited by:

    1. Berggrun, Luis & Cardona, Emilio & Lizarzaburu, Edmundo, 2023. "Industry momentum in Latin America," Journal of Business Research, Elsevier, vol. 158(C).

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