Stop-loss and Target

The momentum portfolio is rebalanced based on the selected frequency and period.

Some investors prefer to limit losses on individual stocks by setting a stop-loss threshold. This ensures that stocks falling below a certain level are exited from the portfolio.

For example, if a 20% stop-loss is set, Momentify will monitor the stock daily.

If the stock falls 20% below the buy price, it will be removed from the portfolio.

Similarly, a profit target can also be set:

If a stock reaches the defined profit target, it will be exited from the portfolio.

Important Notes:

A stock may exit the momentum portfolio due to stop-loss or profit target conditions, but a new stock will only be purchased on the rebalance date.

Stop-loss and profit target conditions are optional and not mandatory for a momentum investing portfolio.