Momentum is Having a Moment

Momentum is often seen as one of the market’s most intuitive forces: stocks that have been outperforming may continue outperforming.^[1] As today’s winning stocks scroll in an endless loop across news channel chyrons, headlines, and social media, it seems as if momentum is working right now. And the numbers behind major market factors show just how dominant momentum leadership has become in 2026.

Momentum Score (Relative to S&P 500)

Does Momentum Have Momentum?

Here’s one reason why momentum could continue to outperform: A sometimes overlooked driver of momentum performance is investor underreaction, by which we mean the slow incorporation of new information into prices (particularly for company-specific news). With one of the most stunning earnings seasons in years coming to an end, investors may still not have digested the true potential strength of current market leadership.

Specifically, during the first quarter, the S&P 500 grew earnings by 25% year-over-year, while the Nasdaq-100 Index grew earnings by 42%. That growth trounced forecasts (by 18% and 29%, respectively).^[2] Investors don’t always fully price in earnings surprises like these immediately, and it may take several months for such a change in fundamentals to be fully reflected in prices. That lag can help sustain momentum leadership in the months that follow.

How to Target Momentum

How can investors pivot to a momentum strategy? Here’s a potential two-step process: First, consider where momentum has been strongest. There has been more momentum in the Nasdaq-100 than in the S&P 500 recently, so investors may want to consider which market they target. The second step is targeting what has been an effective strategy for selecting high-momentum stocks.

Why Consider QQQA?

To capture the momentum opportunity, consider a strategy focused on identifying the leading stocks in one of this year’s leading markets. The ProShares Nasdaq-100 Dorsey Wright Momentum ETF (QQQA) is the only ETF to target Nasdaq stocks using the proprietary Relative Strength indicator from Dorsey Wright, a recognized leader in momentum investing.

Its strategy targets stocks with a higher momentum score, seeking to identify the potential outperformers, and it has had substantially stronger year-to-date returns than the S&P 500 Momentum Index. Its equal-weight approach could also potentially capture a wider range of Nasdaq companies that have benefited from the momentum trend, avoiding mega-cap overconcentration.

The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that an investor's shares, when sold or redeemed, may be worth more or less than the original cost. Shares are bought and sold at market price (not NAV) and are not individually redeemed from the fund. Market price returns are based upon the midpoint of the bid/ask spread at 4:00 p.m. ET (when NAV is normally determined for most funds) and do not represent the returns you would receive if you traded shares at other times. Your brokerage commissions will reduce returns. Current performance may be lower or higher than the performance quoted. For standardized returns and performance data current to the most recent month end, click here.

1. Past performance does not guarantee future results.

2. Source: Bloomberg, data as of 5/18/26.