Richard Driehaus may not be familiar to you… But his investment track-record competes with the very best investors.
Richard started as a stockbroker in the late 1960s and established Driehaus Securities in 1979. The next year he founded Driehaus Capital Management in Chicago, focusing mainly on momentum investing.
In fact, many considered him to be the “father of momentum investing”. This strategy helped…
• Deliver a compound annual return of 30% in the 12 years of Driehaus Capital Management
• His firm accumulate $13.2 billion in assets under management by the time of his death in March 2021
• Propel him to Barron’s All-Century Team in 2000 alongside well-known investors such as Peter Lynch and John Templeton.
That’s why today, I’d like to share how Richard Driehaus’ powerful momentum strategy works- and how it can generate BIG profits.
Momentum Investing: Buy high…Sell even higher!
Richard Driehaus wasn’t interested in picking up cheap stocks and waiting for them to recover. Instead, he stated that, “I believe far more money is made by buying high and selling at even higher prices.”
To do this, he would buy stocks in a strong upward price trend and hold them as long as the upward price movement continued.
He would only sell when he saw a change in the underlying company, industry/sector or overall market.
Of course, for a stock’s price to keep moving higher it needs a catalyst.
That catalyst for Richard Driehaus, was earnings (revenue growth is also applicable).
He loved companies with consistent and sustained growth on a quarter-to-quarter basis.
More importantly, Driehaus saw positive earnings/revenue surprises and positive guidance for future quarters, as powerful catalysts for price increases.
And as I’m about to show you, he was right…
How Momentum Investing led SA Investors to a +265% return in just over three months…
AppLovin (APP) is a Nasdaq-listed company that connects developers and advertisers with the help of its AI platform – AXON 2 – as well as many other value-added tools.
Like many AI plays, AppLovin’s stock has experienced huge rapid gains. As you can see from the chart below, the company’s share price rallied from the beginning of January to August.
That’s when I – with the help of Richard Driehaus momentum strategy – identified AppLovin as a strong momentum profit-opportunity.
AppLovin’s price demonstrated strong upward momentum and boasted a 50% revenue growth rate.
So, I added AppLovin (APP) to our SAI Mega Trend portfolio in late August 2024 (the first star).
And from there, AppLovin’s upward share price trend continued higher – until November.
That’s when the company reported its third-quarter results (the second star), which saw revenue jump 31% and EBITDA soar 58% – crushing analyst’s estimates. Additionally, AppLovin’s management announced next quarter revenue would grow 31%.
As you can see, AppLovin’s results and future guidance impressed investors – sending its share price up a further +129% over the next month.
All in all, AppLovin shares rallied +265% since I added it to our South African Investor Mega Trend portfolio.
This is just one example of how powerful and profitable momentum investing can be – so don’t ignore it! If you’ve not yet set up your Mega Trend Investment portfolio and profit from AI, nuclear, Electrification and crypto, then I urge you to join the South African Investor community.
PS. The SAI Mega Trend Portfolio has delivered a phenomenal 32.47% average return in 2024! So hurry, if you’ve not yet set up a portfolio to profit from AI, Nuclear, Electrification and crypto mega trends then there’s no better time to start – Check out my special mega trend reports updated for 2025 right here…
Not a subscriber to Money Morning?
You can get free daily recommendations like these with Money Morning eletter. Just sign up here.
