AXIOS (Matt Phillips) - What the momentum trade tells us about the stock market
Data: FactSet; Chart: Matt Phillips/Axios The momentum trade is having a terrible start to the second half. Why it matters: Momentum shares drove the market gains early in the year, and it will be harder for the rally to continue without their participation. How it works: Momentum is one of the "factors" some mathematically minded investors, known as quants , use to describe and organize the market according to certain well-understood market trends. - Momentum stocks are defined, more or less, as shares that have been going up — and outperforming the broader market — for roughly a year. - The academic research that quantitative investing is based on has found that such trends have a tendency to persist. - In other words, a momentum…