Aussie Market Eschews Quality And Yield

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SB Citigroup’s quantitative analysts have had a look at the numbers for March, and have concluded that the bull market has resumed with momentum being the operative word. Attention to price momentum, earnings revisions and changes in return on equity (ROE) would have served the investor well last month.

On the flipside, investing for yield has continued to "sink to new lows", Citigroup notes. Yield investment has performed poorly on both a one month and twelve month rolling basis.

If you base your portfolio on quality alone, then you would also have been in the doldrums. High risk resources companies do not fit the quality tag, so you would have missed a lot of the action.

Hmmm. Forget thoughts of quality or yield – go for price momentum. What does this mean may you think?

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