Skip: 1 week

General
1

Hi,
At time 3:06, what does “Skip: 1 week” really means?

Course Name: Momentum Trading Strategies, Section No: 14, Unit No: 5, Unit type: WaterMarkVideo

3

Hi, “Skip: 1 week” means that the most recent week’s returns are left out when calculating past performance to rank stocks. This connects to what was mentioned earlier at 2:59 in the video about return reversal, which means that stocks that went up recently often go down shortly after, and vice versa. By skipping the latest week, the strategy avoids these short-term reversals and makes the momentum signal more reliable, which can help improve performance.