Momentum stocks (buying what has worked) remain the clear YTD winners in equities despite the brief selloff triggered by the Iran conflict. The recovery since late March has been driven largely by momentum stocks, which are +14% since the recovery began in late-March as investors have looked past geopolitical risks. As a result, momentum remains the best-performing factor globally in 2026, with gains of nearly +30% YTD.
Defensive stocks have moved in the opposite direction. Low-volatility stocks are the worst-performing factor globally -18% this year. Value has posted a modest +1.5% gain year to date. Profitability has fared somewhat better during the recovery, with returns broadly flat year-to-date. It’s unclear how the spate of new equity and secondary offerings will impact equity returns ($SpaceX(SPCX.US), Anthropic, OpenAI, $Alphabet - C(GOOG.US) $300 billion equity sales) although SPCX’s post IPO +19% gain on Friday may portend strong investor interest. Source: Bloomberg
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