Returns

Perf Month

Monthly Return

💡 What is Perf Month (1-Month Return)? - Your Investment Report Card for the Last Month

Perf Month stands for Performance Month, and in Korean it's called 1-month return or monthly return. It is a metric that shows, as a percentage (%), how much a stock has gone up or down over the past month (about 21 trading days). Think of it like a student's "report card for this month." Because it measures performance over a short one-month period, it is very useful for understanding the recent market mood and a stock's short-term momentum.

Korean-English Vocabulary Summary

For example, if NVIDIA's (NVDA) Perf Month is +15.3%, it means 1 million won invested a month ago would now be worth about 1.15 million won. On the other hand, if it is -8.2%, it means 1 million won would have shrunk to about 920,000 won.

One month is the most "realistic" short-term time unit in investing. A day or a week is often too short and can be close to noise, while a quarter (3 months) or half a year already reflects a meaningful trend. One month sits right in between—when a new trend begins to form and an existing trend gets confirmed—so it best shows the market's "current direction."

📅 What It Means to Compare Returns Across Time Periods

1-Month vs. 1-Week Return

If the 1-week return is good but the 1-month return is poor, it means only the past week bounced back and the overall trend for the month was downward. In this case, you need to check whether the bounce is just a temporary dead-cat bounce or a real trend reversal. On the flip side, if the 1-week return is weak but the 1-month return is strong, it means the overall trend is upward with a short-term pullback—and that could actually be a buying opportunity.

1-Month vs. 3-Month (Quarterly) Return

If the 1-month return is much stronger than the 3-month return, the stock has recently accelerated. For example, if the 3-month return is +20% but the 1-month return alone is +18%, it means the stock barely moved in the first two months and then surged in the most recent month. This often suggests a new catalyst is at work (such as an earnings surprise or a new business announcement). The opposite case is a warning that momentum is slowing down.

1-Month vs. YTD Return

Comparing with the YTD (year-to-date) return lets you check whether this year's overall trend and the latest month's direction agree. If YTD is +30% but the 1-month return is -10%, the stock has gained a lot this year but is currently pulling back. If YTD is -5% but the 1-month return is +8%, the stock was weak early in the year but is now showing signs of recovery.

📊 How to Interpret the 1-Month Return

Strong Rise: +10% or more

Rising more than 10% in a single month is very strong momentum. Considering that the S&P 500's average annual return is about 10%, that means the stock made a full year's return in just one month. NVIDIA (NVDA) has surged more than +20% in a month several times on AI-related news, and Tesla (TSLA) has done the same on earnings surprises. At this level, you need to check whether the stock is short-term overheated.

Healthy Rise: +3% ~ +10%

This is a healthy pace of gains. If this level of monthly return is sustained consistently, the annualized return becomes very high. Large-cap stocks like Apple (AAPL) and Microsoft (MSFT) often show monthly returns in this range during uptrends.

Flat/Weak: -3% ~ +3%

Essentially a no-move state. The market is undecided and waiting, and the direction could be set upward or downward soon. During this phase, watch the volume trend and other technical indicators to prepare for the next move.

Sharp Drop: -10% or less

A drop of more than 10% in a month is a serious bearish signal. The cause could be an earnings miss, a sector sell-off, or a major piece of bad news. However, if a quality stock fell more than 10% due to external factors (like a broad market crash or an interest-rate shock), it could actually be a good buying opportunity. The key is judging whether the decline is temporary or structural.

🔄 Combining It with Other Return Metrics

The 1-Month Return as a Momentum Factor

Academic research shows that stocks with high 1-month returns tend to keep rising in the short term (the momentum effect). But there is a caveat: an extremely high 1-month return (above +30%) can actually lead to a short-term reversal (mean reversion), so stocks with a moderate level of positive momentum tend to be the most attractive.

Detecting Sector Rotation

By comparing the average 1-month return of each sector (technology, financials, healthcare, energy, etc.), you can see where money is flowing. For example, if technology stocks have a 1-month return of -5% while energy stocks are at +8%, a sector rotation from tech into energy may be underway. You can use this information to tilt your portfolio toward the favored sector.

Performance Relative to the Market (Relative Performance)

Subtracting the S&P 500's 1-month return from an individual stock's 1-month return gives you the "excess return (Alpha)." For example, if Amazon's (AMZN) 1-month return is +7% and the S&P 500 is +3%, Amazon's excess return is +4%. Stocks that consistently deliver positive excess returns have strong momentum relative to the market.

🎯 Practical Ways to Use It

Momentum Screening

On Finviz, you can sort by Perf Month to find the stocks that have risen the most over the past month. Combining filters like "Perf Month above +5% + above SMA20 + rising volume" effectively uncovers stocks with strong short-term momentum. But don't invest on momentum alone—always review fundamental analysis and valuation as well.

Monthly Portfolio Check-Up

At the end of every month, review the 1-month return of each holding. If a stock is persistently underperforming the S&P 500, it's time to consider replacing it. Stocks that lag the S&P 500 for three months in a row may have structural issues. Making monthly reviews a habit keeps portfolio management systematic.

Contrarian Strategy (Mean Reversion)

You can buy high-quality stocks with extremely low 1-month returns (below -15%) expecting mean reversion. Dividend aristocrats like Coca-Cola (KO) or Johnson & Johnson (JNJ) that fell sharply in a month because they got caught up in a broad market drop are likely to rebound—unless the company itself has problems. Don't apply this strategy to declines caused by earnings misses or structural issues.

⚠️ Things to Watch Out For

1. One month is short: Don't judge a stock's value by the 1-month return alone. Price moves over one month are influenced more by market sentiment, news, and supply-demand than by the company's underlying value. For long-term investment decisions, 3-year and 5-year returns and fundamental analysis are far more important.

2. Earnings announcement effect: If an earnings report was released during the month, it has a big impact on the return. A 1-month return that includes a gap up/down after earnings may not reflect the "normal" trend.

3. Overall market influence: If the S&P 500 drops -8% in a month, most individual stocks drop too. Even if a stock's 1-month return is negative, it may actually be relatively strong if it fell less than the market. Always look at performance relative to the market together.

4. Trend-following trap: Chasing stocks just because they have good 1-month returns may mean you're buying in after much of the rise has already happened. Pullbacks after sharp rallies are common, so be careful with your entry timing.

5. Dividend ex-date effect: Around the dividend payment date, the stock price drops by roughly the dividend amount—this is called "going ex-dividend." If a high-dividend stock's 1-month return is slightly negative, it may simply be due to the ex-dividend effect, so check the dividend schedule.

✅ Checklist

☑ Did I compare the 1-month return with the S&P 500?
☑ Did I compare the trend with other periods like 1-week, 3-month, and YTD?
☑ Did I check whether there was an earnings report or major news during the month?
☑ Did I compare with the 1-month returns of competitors in the same sector?
☑ Did I distinguish the cause of the return change (market factors vs. company-specific factors)?
☑ Did I check whether the volume trend supports the price move?
☑ Did I confirm consistency with technical indicators (SMA20, RSI, etc.)?
☑ Did I judge whether the current valuation justifies the 1-month gain?

❓ Frequently Asked Questions (FAQ)

Q. If I buy the stock that rose the most this month, will it rise again next month?

A. Statistically, the "momentum effect" does exist—recently rising stocks tend to keep rising—but this is not guaranteed. In particular, stocks that surge more than +30% in a month often pull back the next month. If you want to invest on momentum, the safer approach is to pick stocks that have risen a moderate amount (+5~15%) and are also supported by fundamental analysis. And always set a stop-loss and manage your risk.

Q. Should I avoid stocks with a negative 1-month return?

A. Not necessarily. In fact, when a good company experiences a temporary pullback and shows a negative 1-month return, it can be a buying opportunity. The key is to analyze the reason behind the decline. You need to figure out whether it got dragged down by the overall market, whether it's company-specific bad news, and whether the issue is temporary or structural. If Apple (AAPL) drops -8% in a month due to a market correction, that could be a buying opportunity—but if it drops -8% due to accounting fraud, that's a completely different situation.

Q. Should I rebalance my portfolio every month?

A. Monthly rebalancing isn't strictly necessary, but a monthly review is a good habit. Each month, check the returns of your holdings, sell some of any position that has grown too large, and add to positions that have shrunk, keeping the balance. However, considering trading commissions and taxes, it's more efficient to rebalance only when a weight has shifted by more than 5~10%. Long-term investors typically rebalance quarterly (every 3 months).

Q. How do I factor in exchange rate moves with the 1-month return?

A. For Korean investors, the actual return in won is the sum of the stock price move and the exchange rate move. For example, if a U.S. stock rises +5% in a month and during the same period the won-dollar rate moves +3% (weaker won), the won-based return is about +8%. On the other hand, if the rate moves -3% (stronger won), the won-based return is only about +2%. The monthly exchange rate typically moves 1~3%, but it can swing more than 5% during a global crisis.

🇰🇷 Tips for Korean Investors

Monthly investment routine: Build a routine of reviewing your portfolio's performance for the previous month on the 1st of every month (or the first trading day). Check each stock's 1-month return, compare it against SPY, and decide whether rebalancing is needed. This single habit can greatly improve your investment management skills.

Currency hedging: Investors who trade frequently on a monthly basis feel the impact of exchange rate moves more strongly. Since the monthly won-dollar move can be more than half of the stock price move, keep an eye on the exchange rate trend too. Some investors buy dollars in advance when the rate is favorable.

Tax considerations: When a strong 1-month return makes you consider selling, calculate your net return after capital gains tax (22% in Korea). Selling within the annual 2.5 million won basic exemption can save on taxes, so make monthly trading decisions as part of your annual tax plan.

Using Finviz: In Finviz Screener, use the "1-Month" filter under the Performance tab to easily search for stocks within your desired 1-month return range. The Finviz heatmap also lets you visualize 1-month performance at a glance, which is very convenient.