The Momentum Investor's Analysis Framework (SEPA)

The momentum analysis framework does something unusual: it filters first for fundamental quality, then for technical setup, and only when both criteria are met does it consider a position. Most investors do one or the other. The SEPA framework insists on both — because the best trades are the ones where accelerating fundamentals and strong price action confirm each other simultaneously.

Why This Matters

Mark Minervini's SEPA (Specific Entry Point Analysis) framework is the most thoroughly documented momentum analysis system. Developed over decades and proven in the US Investing Championship (Minervini has won it multiple times with 3-digit annual returns), it fuses William O'Neil's CAN SLIM fundamental criteria with Minervini's own technical setup methodology. The key insight is that the best momentum opportunities are not random: they occur in stocks with genuine fundamental improvement (earnings acceleration, revenue growth, margin expansion), and they occur at specific points in the stock's price structure where the risk/reward is most favourable. Not every stock with momentum is worth owning; the setup must be right.