The 52-Week High List And Value Investing

Many value investors, myself included, tend to shy away from buying stocks which have risen significantly from their lows, or are trading at 52-week highs.

It takes time to get over the psychological barrier that prevents many investors from buying a stock when it is printing new highs. However, there is evidence that suggests investors should not be so cautious.

Winners and losers identified by the 52-week high strategy

During October 2004, a study was published in the Journal of Finance entitled, "The 52-Week High and Momentum Investing" the study, finds that 'returns associated with winners and losers identified by the 52-week high strategy are about twice as large as those associated...