Do you want to know my favorite feeling as an investor? It’s when my stocks crush the market.
Sure, I like to think of myself as a good guy. I root for others. I want the best for everyone.
But I’m also a natural-born competitor. I played college basketball. It’s coded into my DNA to want to win. In the stock market, that means beating the market. It means owning a group of stocks that absolutely crush the market’s performance.
Well, believe it or not, I’ve engineered a way to do that. Every week without fail.
Seriously. My team has spent the past year creating an algorithmic quant trading model that constantly invests only in stocks that crush the stock market.
Forget the stocks that lose you money. Forget the stocks that go down or those that barely go up. This model algorithmically only invests in breakout stocks soaring higher – and sells them before they stop going higher.
In short, we buy breakouts. That’s why we named our new system Breakout Trader. Frankly, it’s the best trading system you’ve never heard about.
Yesterday, we released a presentation showing how our groundbreaking quantitative model can score you big gains in this bull market transition, along with a “Stage 2” breakout stock pick our system recently flagged.
If you missed it, don’t worry. You can catch the replay here. But I highly suggest that, before you watch the presentation, you read on to learn why we’re so excited about the Breakout Trader system.
The Hidden Pattern in Every Stock
Did you know that every stock on Wall Street follows the same pattern?
It’s true, and it’s the secret reality behind our new quant trading system.
Let’s think about stocks in their simplest terms. At any point, a stock is doing one of three things, right? It’s either going up, going down, or going sideways. By the laws of financial physics, those are the only three things a stock can ever do.
That is the full extent of their behavior.
Let’s extrapolate that further.
If stocks only go up, down, or sideways, then the lifestyle of a stock comprises four stages:
- The stock is either going sideways after going down…
- The stock is going up…
- The stock is going sideways after going up…
- The stock is going down.
Stocks live their entire lives by repeatedly cycling through those four stages.
In a nutshell, that is the simple pattern that all stocks follow.
They are either in Stage 1 (bottoming, or going sideways after going down), Stage 2 (breaking out, or moving higher after bottoming), Stage 3 (topping, or going sideways after going up), or Stage 4 (declining, or going down after topping).
If you look at the illustration above, the best investment strategy for any stock can be simply deduced.
Buy when a stock enters Stage 2. Sell when it enters Stage 3. Short when it enters Stage 4. Forget about it in Stage 1. Buy it again when it goes back into Stage 2.
Our Breakout Trader system executes that simple yet powerful investment strategy algorithmically and automatically.
The Quant Trading System to Crush the Market
Breakout Trader is all about one thing: buying stocks in Stage-2 breakouts and selling them before they enter Stage-3 tops.
To do that, we’ve programmed a complex parametric model that scans the entire U.S. stock market and finds stocks with technical characteristics similar to those in the early innings of Stage-2 breakouts. We screen those stocks, pick the best ones, buy them, and then sell them once that same model says they are entering Stage-3 tops. This means we are constantly buying stocks that are going up, selling them before they top out, and then moving on to the next batch of stocks moving higher.
Pretty simple, right?
It is – if you have the model.
The fact of the matter is that accurately identifying stocks entering Stage-2 breakouts is a hard science. Doing so across thousands of stocks, every single week, is an impossible science… by hand.
But with our quant trading model, it is possible. More than that, it is something we’re already doing with great success.
Over the past six months, the stock market has continued to struggle, with the S&P 500 dropping about 7%. During that same time frame, our model has identified and capitalized on multiple stocks that have risen 20%-plus, including two that soared more than 50% in less than three months!
In other words, our breakout stocks have been soaring even during a nasty bear market.
We have successfully been crushing the market.
And I am very happy about that.
The Final Word
As a competitor, I love to win.
On game nights, I love to win. In basketball games, I love to win. And when it comes to the stock market, I really love to win.
So, I’ve developed the ultimate tool to help me always win in the market.
It’s become my favorite investment tool. In a few weeks, it may become your favorite investment tool, too.
On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.