Momentum investing is more likely considered a stock trading. If you want an easy money on stocks, then learn this strategy.

Stocks has been bought and sold in short period of time, it could be a day, weeks or months, depends how you see short-term trading is. As the old books says, "buy low, sell high" is true enough a basic principle on investing, however on momentum trading it could be "buy high, sell higher".

This strategy is simply seeks and wait to take advantage of market volatility by taking short term position on stocks that are anticipated to move up, after hitting the sign of a peak then automatically sells all their holding. To simply further, it's all like sailing the waves on the ocean, where the trader is at the top on the crest of one of the waves then jumps to the next wave before the previous crashes down again. These traders are always take advantage of the hedging by leading the pack in and then being the first one to sell the fund at peak portion on the volatility waves.

This is usually considered a jerk knee way to play stocks, but don’t understatement them. Short-term trader or momentum traders can gain profit more than the geek professional fund manager or a long-term investor. These traders are risk takers, targeting higher return on the market. They might be wrong on their speculations but can hit a jackpot if all their research and persuasion is right. Like a surfer that tries to plays on the crest of waves, the momentum traders are always at risk of timing a buy incorrectly and may end up under water. Most momentum or short-term traders already accept this risk as payment for the possibility of higher gains or profit they speculated.

Strong momentum is seasonal event on the market and there’s a secret on it. Momentum trading can really work and hit good profit at short period of time, but this is really a risky way to manage your portfolio. So this means, this strategy is not necessarily for everyone, it takes strong discipline to trade this way. Consider also the other negative factors, such as broker commission fees, time of research, pressure on monitoring, etc.

On the other side, short-term or momentum traders can profit 20.0% ~ 50.0% in single week alone. To detect an upcoming momentum, there must by an arising issues; upcoming IPO’s, dividends, new profitable projects, annual reports, etc.

See below sample chart, where traders perfectly ride the waves and make profit from the hedge.

Century Peak Metal Holding Corporation, surges after the IPO release to the public and the first smelting company in the Philippines. Alphaland Corporation is a former Macondry Plastic Corporation, price starts to pumps up after news says the changes of management with the company's name and can be used as back door entry of the new chairman of the board from his other investments.

Personally, I hit 180% profit on this AlphaLand Corporation issue.

This are a good examples of higher risk higher return on the market trading. Good luck!.