Returns

Perf Quarter

Quarterly Return

💡 What is Perf Quarter (Quarterly Return)? - A 3-Month Investment Performance Metric

Perf Quarter stands for Performance Quarter. In Korean it is called quarterly return or 3-month return. It is a metric that shows, as a percentage (%), how much a stock's price has gone up (or down) over the most recent 3 months (about 63 trading days). Think of it like a midterm exam score: it is not the full report card for the whole semester (1 year), but it still tells you a lot about how the student is doing and which direction they are heading.

Korean-English Keyword Glossary

There is a good reason why the 3-month (quarterly) period is special in investing. U.S.-listed companies are required to report their earnings every quarter. Since the 3-month return always covers at least one earnings release, it reflects the company's actual business performance. In addition, many institutional investors are evaluated and rebalance their portfolios on a quarterly basis, so the quarterly return also reflects the flow of institutional money.

For example, if Tesla (TSLA) has a Perf Quarter of +22%, that means ₩1,000,000 invested 3 months ago would now be worth ₩1,220,000. Annualized, that works out to roughly +119%, which is an extremely high return. On the flip side, -15% means the ₩1,000,000 shrank to ₩850,000, which could be due to a quarterly earnings miss or weakness in the sector.

📅 What It Means to Compare Returns Across Different Time Frames

Quarterly vs. 1-Month Return

If the quarterly return is positive and the most recent 1-month return is also positive, the trend is holding up consistently. If the quarterly return is good but the 1-month return is bad, it usually means the first 2 months of the quarter were strong but the stock has just started to turn down. On the other hand, if the quarterly return is poor but the 1-month return is good, a rebound has just begun, which could be the early stage of a trend reversal.

Quarterly vs. 6-Month / 1-Year Return

If the quarterly return makes up most of the 6-month or 1-year return, it means there was a sudden change during the most recent 3 months. For example, if the 1-year return is +50% and the quarterly return is +40%, the previous 9 months were basically flat and almost all of the gain came in the most recent 3 months. This usually points to a powerful catalyst at work, such as an earnings surprise or a new business announcement.

Tracking Consecutive Quarterly Returns

Tracking returns across several quarters in a row helps you judge how durable a trend is. Four straight quarters of positive returns signal a strong uptrend, while alternating positives and negatives means the stock is choppy with no clear trend. Quality names like Amazon (AMZN) or Microsoft (MSFT) tend to post positive quarterly returns in most quarters of a long-term uptrend.

📊 How to Interpret Quarterly Returns

Bullish: +15% or higher

A gain of 15% or more in a single quarter shows very strong momentum. Annualized, this is roughly +75% or more. Nvidia (NVDA) during the AI rally and Meta (META) during its post-efficiency rebound both recorded quarterly returns at this level. Causes include earnings surprises, sector booms, and large contract wins.

Healthy: +5% to +15%

This is a solid rate of advance. Annualized, it is roughly +22% to +75%, well above the S&P 500's long-term average. Large-cap quality stocks in a steady uptrend often sit in this range. The trend is likely to continue, and this can be a range where adding to positions makes sense.

Flat: -5% to +5%

The direction is unclear. This shows up when the market is in wait-and-see mode or when opinions about the company are split. Since the next earnings release or a major event can set the direction in this zone, check the relevant event calendar and be prepared.

Bearish: -10% or lower

A drop of 10% or more in a quarter is a meaningful bearish signal. Possible causes include earnings misses, guidance cuts, broad weakness in the sector, or interest-rate shocks. It is very important to judge whether the drop is temporary or structural. If it is temporary, it can be a buying opportunity for a rebound; if it is structural, further declines are likely.

🔄 Combining With Other Return Metrics

Quarterly Return as a Momentum Factor

Academic research has shown that 3- to 12-month momentum is one of the strongest stock-price predictors. Stocks with a positive quarterly return are statistically more likely to also post a positive return in the next quarter. The momentum strategy that uses this effect is one of the few strategies that has beaten the market over the long term.

Connection to Earnings Releases

The quarterly return directly reflects the impact of the earnings announced during that quarter. If there was an earnings surprise (beating expectations), the quarterly return is likely to be good, and if there was an earnings miss, it is likely to be bad. However, the overall market mood (rates, economic indicators) can make a stock drop even after good earnings or rise even after bad ones, so you have to look at the broader context as well.

Comparing Quarterly Returns Across Sectors

By comparing the average quarterly return of each sector, you can see which direction money is moving. If the tech sector is +12% for the quarter and energy is -5%, money is rotating into tech and out of energy. You can use this information to put more weight in the favored sectors.

🎯 Practical Ways to Use It

Quarterly Portfolio Review

At the end of every quarter (March, June, September, December), review the quarterly returns of the stocks you own against the S&P 500. Consider replacing any stock that has lagged the market for two quarters in a row, and keep or increase the weight of stocks that consistently beat the market. Just this habit alone makes portfolio management more systematic.

Earnings Season Strategy

Before earnings season (January, April, July, October), analyze the previous quarter's return to gauge the market's expectations for the upcoming earnings. If the quarterly return is already very high, expectations are high and even good earnings can send the stock down ("Sell the News"); if the quarterly return was weak, expectations are low and a decent report can trigger a rebound.

Momentum Screening

In Finviz, use a filter like "Perf Quarter +5% to +20%" to find stocks with appropriate momentum. Too high a return (above +30%) carries overheating risk, while too low or negative returns carry bearish risk, so finding the right range is the key.

⚠️ Caveats

1. A strong past quarter does not guarantee the next one: The momentum effect is only a statistical tendency, and for any individual stock a reversal can happen at any time.

2. Earnings releases have a big impact: A quarter that contains an earnings release is very different from one that does not. The sharp moves caused by earnings reports can make up most of the quarterly return.

3. Separate out the impact of the overall market: When the S&P 500 falls -10% in a quarter, most stocks go negative. Stocks that fell less than the market are relatively strong.

4. Dividends are not included: When a quarterly dividend is paid, the stock price drops on the ex-dividend date. A quarterly return that is slightly negative can actually be positive once the dividend is added in.

5. Quarter-end window dressing: Institutional investors tend to buy winning stocks and sell losers at the end of a quarter to make their performance look better. This can create artificial price moves around quarter-ends.

✅ Checklist

☑ Did you compare the quarterly return with the S&P 500 (SPY)?
☑ Did you analyze the trend together with the 1-month, 6-month, and 1-year returns?
☑ Did you check whether an earnings release happened during the quarter and what the result was?
☑ Did you compare the quarterly return with competitors in the same sector?
☑ Did you look at the return trend across several previous quarters?
☑ Did you separate the cause of the quarterly return move (market factors vs. company factors)?
☑ Did you check the schedule of major events for the next quarter (earnings releases, FOMC, etc.)?
☑ Did you judge whether the valuation justifies the quarterly rally?

❓ Frequently Asked Questions (FAQ)

Q. Is it a good idea to rebalance every quarter?

A. Quarterly rebalancing is recommended by many institutional investors and financial planners. However, you have to factor in trading fees and taxes. Instead of a full portfolio overhaul every quarter, it is more efficient to only adjust positions that have drifted far from their target. For example, rebalancing only the stocks that have moved more than 5% from their target weight keeps transaction costs low while maintaining portfolio balance. For long-term investors, semi-annual (every 6 months) or annual rebalancing is also enough.

Q. Is there a season of the year when the quarterly return is usually best?

A. Historically, the U.S. stock market has shown seasonal patterns. November to January (the year-end rally) and April to May have been relatively strong quarters, while September and October have historically been more volatile months. The saying "Sell in May and Go Away" also comes from the rule of thumb that May through October tends to be weaker. That said, these are only statistical tendencies and can be different every year. In particular, rate moves, elections, and global events can overwhelm seasonal patterns.

Q. How are quarterly returns related to earnings season?

A. The single biggest event affecting the quarterly return is the earnings release. U.S. earnings season usually starts 2 to 6 weeks after the quarter ends (Q1 earnings come out in April, Q2 in July, Q3 in October, and Q4 in January). When earnings far exceed market expectations, a stock can jump 10–20% in a single day, and that move alone can account for most of the quarterly return. So when you analyze a quarterly return, it is more accurate to separate out the price moves right around the earnings release.

Q. How much does currency fluctuation affect the quarterly return?

A. Over 3 months, the won/dollar exchange rate usually moves about 1–5%. If the stock price move is larger than that (quarterly +10% or more, or -10% or less), the currency effect is relatively small, but in quarters when the stock barely moves (-2% to +2%), exchange rate moves can account for more than half of the won-denominated return. For example, if the stock is up +1% but the won weakens by 3% against the dollar, the return in won is roughly +4%.

🇰🇷 Notes for Korean Investors

Quarterly Investment Routine: Try building a routine of checking these three things at the end of every quarter. (1) Compare each holding's quarterly return against SPY, (2) Check sector-level quarterly returns to read the flow of money, (3) Check the next quarter's earnings release schedule. Just this routine alone will make your investment management more systematic.

Tax Management: Tracking realized gains and losses by quarter helps with year-end tax planning. If realized gains through Q3 (September) already exceed the ₩2,500,000 basic exemption, you can sell losing positions in Q4 to net the gains against the losses and lower your tax bill.

Using Finviz: In the Finviz Screener, the "Perf Quarter" filter lets you easily search for stocks within your desired quarterly return range. Selecting "Performance Quarter" on the Finviz heatmap gives you a visual snapshot of the entire market's quarterly returns at a glance, which is very convenient.

Preparing for Earnings Season: U.S. earnings are released in the early morning hours Korean time, so it is important to plan your strategy before the release date. Use an Earnings Calendar to find the release dates for your holdings and decide in advance what you will do around the release (hold, sell, or buy more).