Can someone please explain to me why Computacenter (CCC) which has been dropping from a high of 1620p in July to 1188p at close of business yesterday (12th Oct), still has a momentum rank of 97?
Always worth checking this out - https://help.stockopedia.com/product-guide/stockranks/basics/the-momentum-rank
Although it is down a lot, relative to the rest of the market it is performing quite well.
Even being -27% off the 52-week high is about the median fall at the moment.
Understood; thank you! Can't help feeling though, that an algorithm which rates a stock that has been dropping consistently for over three months and by 27%, as having a positive momentum of 97%, is inherently misleading.
To describe the measure as misleading I think is highly unfair.
It does not purport to be the "3 month price move rank". instead it is clearly identified as a composite ranking of various earnings momentum and price momentum factors (itemised in Nick Ray's post above).
Clearly the price fall in the last three months will influence some of those elements, but it is insufficient to over the other strong rankings.
A number of people use the StockRanks as a starting point but then apply other tests qualitative or quantitative.
If you feel strongly about the predictive power of three month price movements, you could at that as another test in your selection method.
I am not convinced though that it would necessarily improve performance, I suspect that the reason the weighting of this factor appears to be relatively low, will be because it has not proven to be a sufficiently strong predictor of future performance.
