Methodology
Let's start with the process. The aim here is to build a selection that is both high-performing and resilient. To achieve this, I rely on Evidence Based Investing, i.e. scientific research that has proven the relevance of certain investment strategies over time. This highly rational investment process has highlighted the relevance of certain investment factors.
The Momentum Picks selection is based primarily on two of these factors: Quality and Momentum.
- Momentum : In the classic sense of the term, momentum is an investment approach that favors stocks that have been trending upwards over the past six and twelve months. At MarketScreener, momentum includes not only data relating to a stock's positive trend over the short, medium and longer term, a so-called "technical" momentum, but also analysts' earnings and sales revisions over the short and long term, weighted by the number of shares in circulation. This is more "fundamental" momentum, based on the assumption that analysts are rather conservative in their revisions. To understand the momentum factor, I invite you to read this eulogy of momentum.
- Quality : The quality factor favors companies with solid fundamentals, i.e. positive profitability (if possible), high profitability, a healthy balance sheet, a good track record and a strong balance sheet, a healthy balance sheet, low margin volatility, a good track record of earnings releases and good visibility on future results.
Another advantage of the Momentum Picks selection is that, every quarter, we reset our thinking. I start from scratch to create the best possible selection. This constant rethinking helps avoid clinging to old ideas that might not work as well. After all, "when you can't go back, you only have to worry about the best way forward" (Paulo Coelho). Having been an enthusiast of behavioral psychology since my university days, I place great emphasis on integrating mental models into my management process, enabling me to avoid being led astray by my cognitive biases as much as possible.
The selection is designed to generate the best possible risk/reward given its limited composition. However, a selection of just five stocks does not constitute a sufficiently diversified portfolio. Rather, Momentum Picks should be seen as a complement to an already diversified portfolio. In fact, I invite you to think critically about this selection and do your own research on these companies. While this section provides insights into both the process and the outcome of that process, remember that this is your investment decision.
3-year review and analysis of past performance
In our previous selection, we chose AppLovin, Universal Health Services, Heico Corporation, Nu Holdings and Freshpet. A portfolio weighted equally on these five positions would have generated a return of 20.30% versus 2.07% for our benchmark, the S&P 500 index, over the fourth quarter of 2024 (from 09/30/2024 to 12/31/2024), i.e. an outperformance of 18.23%. At individual level, AppLovin gained +148.05% over the quarter, Freshpet gained +8.29%, Universal Health Services, Heico Corporation and Nu Holdings corrected by -21.65%, -9.08% and -24.10% respectively.
AppLovin spearheaded this selection this quarter and in the two previous quarters. It achieved a performance of +367.83% since entering the selection at the end of March 2024 and +712.62% in 2024, the best US stock market performance of the year among market capitalizations of over $10 billion. It contributed to the Momentum Picks selection, which achieved a performance of 92.40% in 2024, compared with 23.31% for the S&P 500 (here both without dividends reinvested). AppLovin crowned its operational success by entering the Nasdaq-100 in early December. Despite its flawless track record to 2024, we are selling the stock as its valuation is a little too far ahead of its fundamentals for my liking.
The Momentum Picks selection , which began on December 31, 2021, achieved a cumulative performance of 142.96%, compared with 23.40% for our benchmark, the US broad S&P 500 index, i.e. an outperformance of +119.56% in 3 years. The most assiduous readers of this section replicating this selection have more than doubled their capital in less than 3 years, and outperformed the S&P 500 by a factor of 6. This performance was achieved without taking advantage of the Magnificent 7, as none of these 7 technology giants were included in the selection. Proof that we can find investment ideas elsewhere.
Cumulative performance

To cite a few other indices, the Nasdaq-100 posted a cumulative performance of 28.75% over the same period, the MSCI World 14.73% and the Stoxx Europe 600 4.06%. What's more, Momentum Picks' performance does not include the payment of dividends to shareholders over the period, so actual performance is even higher than these figures. The most assiduous readers of this column have more than doubled their capital in 3 years and outperformed the S&P 500 by a factor of 6.
This performance surplus is due to three main parameters (two of which are controllable):
- The use of a time-tested strategy based on scientific research;
- Equal-weighted management that is pragmatic, impartial and free from emotional bias;
- A little luck.
Despite these very encouraging performances from our proven selection and management process, we must remain humble in the face of the market. I agree with François Rochon of Giverny Capital on the famous rule of three. One year out of three, the stock market will fall by at least 10%. One stock out of three will be a disappointment. One quarter out of three, the Momentum Picks selection will underperform the market. This is not a foregone conclusion, but rather an objective way of looking at stock market reality. There's always an element of chance. It's essential to be aware of this in order to prepare psychologically for the inevitable periods when Momentum Picks will underperform our benchmark.
Performance by quarter

The Momentum Picks selection has outperformed its benchmark (S&P 500) over 10 of the last 12 quarters. We can therefore observe a certain recurrence of performance in phases of market contraction as well as expansion.
The new selection
Let's take a closer look at the five US stocks selected for the first quarter of 2025 (January to March).
Equal weighted Momentum Picks Q1 2025

Founded in 2004, Natera is listed on the NASDAQ under the symbol NTRA. It is a diagnostics company specializing in molecular testing, using its cell-free DNA (cfDNA) technology in three key areas: women's health, oncology and organ