Stockopedia chief executive Ed Croft has published research formalising the StockRanks Jump Effect, a pattern he says he traded on instinct for years before subjecting it to systematic analysis across the London market.
The study measured every one-week StockRank jump recorded on the London market over twelve years, capturing 5,902 events, and then tracked what happened next to each stock, according to the StockRanks Jump Effect research report.
What the StockRanks Jump Effect measures
The StockRank is an equal-weighted composite of Quality, Value, and Momentum sub-ranks, each expressed as a percentile from 0 to 100 across 36,000 stocks processed through Stockopedia’s proprietary algorithms, as explained in the Stockopedia Academy.
The overall score tells investors how good, how cheap, and how improving a business is relative to its peers. A jump occurs when that composite rank rises sharply in a single week, typically because results, a broker upgrade, or the tone of a trading statement has shifted the underlying inputs.
Croft’s central finding is that change beats level. A company that has just become excellent tends to outperform one that has always been excellent, because the market is slow to price in the shift.
That lag, he argues, has academic roots stretching back decades and is sharpest among smaller companies that institutional investors cannot easily access.
Track record behind the StockRanks Jump Effect
The broader StockRanks system, launched in April 2013, has a documented long-run track record. High-ranked stocks scoring 90 or above have historically produced win rates of approximately 2-to-1 winners versus losers. The lowest-ranked stocks have run at roughly 3-to-1 against, according to Stockopedia’s StockRanks overview.
Stockopedia’s systematic No Admin Portfolio System (NAPS) strategy, which uses simple repeatable rules built on StockRanks, has averaged over 13% annualised returns across more than ten years.
For investors running systematic portfolios, Stockopedia recommends holding 15 to 25 top-ranked stocks and rebalancing semi-annually or annually. A 90/70 guideline governs exits: stocks that fall below the exit threshold are removed to reduce emotional bias in sell decisions.
Croft discussed the research in a conversation hosted by UK Investor Magazine, covering both where the approach works and where it fails. The sweet spots are stocks where the rank jump reflects genuine operational improvement rather than a one-off data anomaly.
He cited Rolls-Royce as an example where the StockRank turned ahead of the headlines, and cautioned that well-known compounders typically never trigger the jump signal precisely because their quality is already fully reflected in market prices.
The practical application Croft outlines treats a rank jump as a trigger for research rather than an automatic buy signal. Position sizing, entry timing, and the question of when to sell all require additional judgement.
He also gives an account of where the approach falls short: momentum-driven jumps that do not survive the next results cycle, and small-cap stocks where liquidity constraints make execution harder than the back-test implies.
The full StockRanks Jump Effect study, covering the twelve-year London market dataset and the 5,902 captured events, is available through the Stockopedia research academy. A companion webinar is scheduled for investors seeking a live walkthrough of the methodology.
