One of the basic tenets of investment is not to buy an asset just because its price has gone up.
And yet in the last decade, performance chasing has been a much better strategy than buying investments which have seen their prices fall sharply – a blind bargain-hunting approach which appeals to many people, but comes with its own health warnings.
AJ Bell has put five common investing strategies to the test to see how they stacked up against each other (see table below).
Perhaps not surprisingly in such momentum-driven markets, performance chasing came out top, with bargain-hunt…
Performance chasing has served well despite risks
