Abstract
Investment newsletters abound. They can be very profitable for those who publish them, but research to date has not found that they actually add value over time in comparison with passive investing. Good ideas may of course be found within particular newsletters at particular times, but investors cannot profitably accept all of a newsletter’s recommendations without independent analysis.
However, application of momentum investing techniques to newsletters suggests that there are periods in which a particular newsletter has a “hot hand,” and following that newsletter’s recommendations during those periods can be profitable, advises George Crawford , Head of the Investment Research Foundation in New York.
Crawford, Alex Krause, Research Associate at the Investment Research Foundation and Jim Kyung-Soo Liew , Assistant Professor in Finance at the Johns Hopkins Carey Business School , coauthored Evidence of Momentum in Newsletter Recommendations , which appeared in the Fall 2013 issue of The Journal of Alternative Investments .
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