College of Administration and Economics – University of Kerbala has discussed the M.A. thesis which is entitled “the use of 52-week momentum approach for forming a superior active portfolio – an applied study in Iraqi stock market for period from January 2016 – November 2023”.
The study, presented by Ahmed Falah Hassan Al-Safi, aims at verifyig whether momentum strategies based on returns to the highest price within 52 weeks of stocks listed on Iraqi Stock Exchange achieve unusual profits.
The study concludes that, in light of 52-week high price strategy and during two periods before and during COVID-19 pandemic, all momentum strategy portfolios with winning and losing portfolio are unable to cover cost of financial market transactions before and during COVID-19 pandemic.
One of the key findings of the study is that momentum portfolios, following 52-week strategy, generate returns, but these returns are not statistically significant. These returns diminish with the inclusion of transaction costs. Due to the high transaction costs within the Iraqi stock market, the study advises against using the 52-week high strategy due to the lack of profit coverage for transaction costs within the market.
