Bank of America says investors face a "huge risk" of being too defensive at the trough of a cycle and advises reducing the size of such positions. The bank noted that stocks with "expensive negative momentum" — which it dubbed "the defenders" — outperformed in November on the back of a less aggressive U.S. Federal Reserve and signals that China may loosen its zero-Covid policy.
Stocks that are 'global contenders' Against this backdrop, BofA identified stocks that are "inexpensive" but have strong earnings momentum and price momentum. It dubs these "global contenders." "Our back-testing and subsequent performance show that stocks with above-average earnings momentum tended to outperform, stocks with above-average price momentum tended to outperform, but stocks with both the characteristics tended to perform even better," it wrote.
Bofa 🤨
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Global stocks tumbled last week — but these names bucked the trendHong Kong-listed stocks had a good week in particular, as a local news outlet reported the city is considering easing Covid measures further. Mark as paywall pls Thanks Joe!!!
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