How to Invest in Tempo Stocks

Video Transcript

"Hi I'm Roger Groh with Groh Asset Management. We're here today to talk about stocks that are moving up quickly in price. On our end, we usually refer to those as stocks that have momentum or upward tempo. Now it becomes a self fulfilling prophecy the quicker they move up, the more money that comes in. On the other hand, as soon as they top out and start to go, that money gets whipped out and momentum can become negative at that point. So you have to look at both sides of the equation. How can you identify them? Well if you go to websites that are fully available to you, if you go to Bloomberg.com or perhaps Reuters.com or Schwab or Smith Barney or Merrill Lynch, they have public portions of their website which will let you look at momentum indicators. And within that group you can look at what's positive and negative and make your choices. This is not for the faint of heart, what's going up this minute can quickly be going down the next. So it's not traditional long term investing. In my mind, the likelihood of making money in this is low. You have to be a trader and for most people, that's a difficult thing to do. So I'm Roger Groh, thank you for spending a little time with me and that's a little bit about tempo stocks."