| Leaders: Leading Stocks Are Leaders For A Reason
The stocks outperforming the market tend to continue performing well, while lagging stocks are likely to remain underperformers. Here, you'll see why this is an important lesson for investors and how to identify the leading stocks.
Assess Your Knowledge On This Topic
The Best-Performing Stocks Continue
Performing Well
How many times have you concluded a stock's best days are behind it, only to watch it soar as you stand on the sidelines? This assumption has often come back to haunt investors. In reality, the stocks that are doing best tend to keep doing well, while those slumping likely will continue to do poorly. Why? The great companies manifest their strength through superior performance in terms of earnings, sales, profit margins and, yes, even the performance of their stock.
A study of the greatest stock market winners found that all-star stocks had, on average, outperformed 87% of the market before they began their most dramatic price advances. In other words, they were already in leadership positions. This concept is contrary to the popular bargain-hunting mentality, but is based on historical facts.
|
|
Related Resources:
Click here to get the 7 Steps For Selecting Winning Stocks, according to the CAN SLIMTM Investment Research Tool.
Go to the Investor's Corner Archives to read IBD's "editor picks" of classic Investor's Corner columns.
Search our archive of Ask Bill O'Neil Q & A's organized by topic.
|
| |
|
© Investor's Business Daily, Inc. 2000-2008. All Rights Reserved. Reproduction or redistribution is prohibited without prior authorized permission from Investor's Business Daily. For information on reprints, webprints, permissions or back issue orders, go to www.investors.com/terms/reprints.asp.
|
