NEW YORK (TheStreet) -- With the stock market virtually rising without pause for more than three years, investors who want to follow the gospel of buying low and selling high are stymied at almost every turn.
So why bother? Instead, buy high and sell higher.
To be sure this strategy is full of risks, but some funds that effectively take this approach are pulling it off with spectacular results.
The strategy is known as momentum investing, and it takes two huge skills to succeed. One is to find highly volatile stocks that are going up fast.
Think emerging markets, high-growth, high-tech and small-cap before the 30 corporations that make up the Dow Jones Industrial Average.
The market is considered inefficient for these generally lesser-known companies.
Eventually though, the market is likely to take notice, say, if there are higher-than-expected quarterly earnings. Such announcements often lead securities analysts to write glowing reports, investors to demand the stock and the price to leap, in other words, momentum.
Getting out is as important as getting in. Having a quick trigger and being ready to pull it is an essential part of a successful strategy.
In stock market terms, it means portfolio turnover is high.
Reasons to get out include a breakdown in fundamentals and choppiness in the movement of share prices.