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Momentum ETFs Stall in 2025


Published on 2025-03-28 12:41:10 - Morningstar
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  • Momentum ETFs rode a hot tech rally in 2024, but they've tripped as those stocks stumbled. Many momentum ETFs loaded up on Nvidia, Palantir, and other AI favorites. As value and defensive stocks (out of favor in 2024) have outperformed,

The article from Morningstar discusses the recent performance and outlook for momentum ETFs, which have experienced a slowdown in 2025. Momentum investing, which involves buying assets that have shown an upward trend in price, has not been as effective due to various market conditions. The piece highlights that after a strong run in previous years, these ETFs have faced challenges from increased market volatility, shifts in investor sentiment, and changes in economic indicators. Factors such as rising interest rates, inflation concerns, and a potential shift towards value investing have contributed to the stalling of momentum ETFs. The article also notes that while some investors remain hopeful for a rebound, others are reevaluating their strategies, looking towards sectors that might benefit from current economic trends or diversifying into other investment styles to mitigate risks.

Read the Full Morningstar Article at:
[ https://www.morningstar.com/funds/momentum-etfs-stall-2025 ]