Chase Last Year's Winners
MomentumOn the first trading day of each January, buy the 10 S&P 500 stocks with the highest total return during the prior calendar year, equal weighted. Hold for the year, then rebalance.
See this in the terminal — live earnings bands, fair value and rates.
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You've been told not to chase performance. Chasing it would have 27.7x'd your money.
The rule. On the first trading day of each January, buy the 10 S&P 500 stocks with the highest total return during the prior calendar year, equal weighted. Hold for the year, then rebalance.
What actually happened.
- $10,000 became $276,813. The same $10,000 in S&P 500 (SPY) became $86,775. This strategy beat the benchmark by $190,038.
- Compounded at 24.8% a year vs 15.5% for the benchmark.
- Best year: 2021 (+48%). Worst year: 2022 (-11%). This is not a smooth ride.
The catch. At its worst, this strategy fell -37% from a prior peak — deeper than the benchmark's -34%. Would you have held through that? Most people don't. That's the whole game.
The takeaway. It worked here — but "it worked in the past" is the most expensive sentence in investing. The edge is real only if it survives costs, taxes, and the drawdown above. Show your work, then decide.
Holding right now (2026-01-02): CVNA, FIX, HOOD, LRCX, MU, NEM, PLTR, STX, WBD, WDC.
Drawdown from prior peak
Calendar-year returns
| Line | 11* | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26* |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Last year's 10 winners | +2% | +14% | +37% | +13% | +4% | +19% | +31% | -7% | +41% | +46% | +48% | -11% | +6% | +47% | +35% | +78% |
| S&P 500 (SPY) | +10% | +16% | +32% | +13% | +1% | +12% | +22% | -5% | +31% | +18% | +29% | -18% | +26% | +25% | +18% | +14% |
* Partial year — the backtest does not cover this whole calendar year, so it is excluded from the best and worst year figures.
Holding now · 2026-01-02
Includes stocks later dropped from the S&P 500 where price history exists (138 of 345). The rest are missing, which can flatter momentum-style ideas. How we test
Rebalance: annual (first trading day of January), equal weight · Window: 2011-09-28 → 2026-09-28 · Last run Sep 28, 2026 · JSON