Didn't Buy Serabi Gold? Why Clear Uptrends Are The Best Uptrends And 20 Stocks To Consider Now

8:33am by Edward Croft

6 comments 324 reads

Have you ever watched a share rise and rise - and never had the courage to buy it? I do and regret it all the time. The numbers often look good, brokers are upgrading forecasts, but the price keeps grinding higher and gets away from you. You wait for a pullback but it never comes. A year later and it's doubled again!

This annual series is my attempt to fix that mistake. It rests on a counterintuitive idea - that the shares with the clearest, strongest price trends tend to continue to outperform. But these are the ones our instincts tell us to avoid.

While the research is robust, two years of published returns now back this strategy up. The May 2024 "Didn't buy Warpaint?" portfolio is up 71% against the FTSE All Share's 22%. The June 2025 "Didn't buy Rolls-Royce?" list did it again - +30% in just eleven months vs +15% for the FTSE.

This year's top 20 are laid out below, but the same mental aversion applies - every share already looks "too late". You are likely to feel huge resistance as you read these names and their charts. But it's this psychology that underpins why the approach works - when everyone turns away, stocks are often underbought.

One thing worth mentioning. The share I name in the title each year has a habit of not leading the next pack. Warpaint slipped 12% in the year after the 2024 piece (and collapsed 64% over two years). Rolls-Royce has kept rising and made eighth place. As for Serabi Gold itself - up 412% since the 2024 list after 2 years of inclusion - it's not made the cut this time. Will it sustain its momentum?

The rules, recapped

A 2024 paper called Trended Momentum showed that shares whose price charts trace a smooth, orderly line - high "trend clarity" - significantly outperform standard momentum. You measure it with the r-squared of a regression line through the share price. The original write-up has all the details - but the graphic below is easy to understand - you want to pick a smooth glide path, not a wild one.

Here are my own rules, which skew towards higher ranks:

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Epitychia

9:16am

Thanks Ed another fantastic article.

Momentum seems to be the strongest factor, but it does occasionally suffer from dramatic drawdowns when the narrative changes. Some academics argue that this risk is the reason the factor premium is not eroded away.

With that in mind, it would be useful to have an escape route when disaster strikes. I suggest a stop loss at the 20% mark. Alternatively limit the portfolio to no more than four shares in each theme / industry.

Cricketfan

9:19am

Thanks Ed - an interesting read.

My half-crown bet is on AEP. Why? I suspect a food related commodities surge may be on the way and had that in mind even before the latest El Nino story. In passing, I hold a different palm oil producer - REA Holdings whose 9% Prefs have done me well over some many years.

Brucie5

9:22am

Ceres Power Holdings (LON:CWR) : watched it, as my father used to tell me wrt learning the game of tennis, "right onto my racket" - about this time last year - only to let it go. I try my best not to look at it now.

;)

Edward Croft

9:23am

It's interesting when you interrogate this list because the average share on this list has risen by 120% in the last year. That creates vertigo. Nonetheless, the median earnings yield is 11% - which is impressive given the price rises. It's not a premium list - it still skews towards value.

wildshot

9:45am

Great article and research Ed. I hold a few of those listed above since in recent months (based on your published research) I've been experimenting with part of my portfolio into high QM ranks and earnings upgrade stocks. Performance is encouraging so far but I'm early into the experiment. Your 2 year history builds confidence for the rest of us.

Is there a way we can copy your screen so we can research further? Also how do we calculate the R2 or is there a filter in your screening tool for this?

Gari

9:49am

I can do better than that, bought at 200p sold at 45p now 700p. So bad it's embarrassing rather than annoying

Didn't buy Serabi Gold? Why clear uptrends are the best uptrends and 20 stocks to consider now

The rules, recapped

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Edward Croft

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