Van’s Note: Van Bryan here, Jeff Brown’s managing editor.
As Jeff likes to say, the mission of The Bleeding Edge is to keep readers up on the latest technology investing trends. But when we find profitable ideas from our colleagues, we share them with readers.
Today’s special morning edition comes courtesy of Jason Bodner. Jason is a true Wall Street insider. For years, he oversaw billion-dollar trades for institutional investors at Cantor Fitzgerald. Nowadays, he uses his proprietary trading algorithm to track institutional money heading into stocks. And he uses that knowledge to help his readers “catch a ride” as these whales push stock prices higher.
I’ve spoken with Jason at length over the years. I can’t recall a single time where he said anything uninteresting or unhelpful about investing. In addition to Jeff Brown’s work, I recommend every serious investor read Jason Bodner.
“Buy the best stocks – then, pretend you’re dead.”
I recently wrote a report for a close friend who’s also a multibillion-dollar asset manager.
He wanted to know the best way for his clients to make money in stocks over the long term. And that’s what I told him in the report.
So today, I’ll show you why this “zombie” trading strategy is one of the most profitable ways for ordinary investors to get rich from the stock market…
The Zombie Strategy
The premise of the strategy is simple: Buy elite companies and don’t touch them. You’ll likely wake up very rich decades from now.
Michaela Pagel is an assistant professor of finance and economics at Columbia Business School. And her research found that investors following this method generally perform better…
History has shown us that the stock market is a relatively safe bet over the long term because it has typically grown. Investors would be wise to keep this in mind, because those who check their portfolios too often and are driven by the daily or hourly fluctuations in the market may make decisions that have a negative impact on their long-term financial prospects.
And the data is indisputable: Over the last century, the market has continued to climb higher:
But here’s the thing…
A 2017 study by an Arizona State University finance professor found that – over the past 100 years – just 4% of stocks have accounted for nearly all the profits of the market each year.
Now, I call them outliers. These companies are unique in their business, grow sales and earnings at high rates, and have big profit margins.
And if you’re serious about making money, they’re the stocks you want to hold for the long term.
Outliers are where the big money is hiding out. So if you’re not targeting them, you’re basically wasting your time as an investor…
How to Identify Outliers
Regular readers know I spent nearly two decades on Wall Street, at prestigious firms like Cantor Fitzgerald, trading more than $1 billion worth of stock for major clients.
But I walked away from it all and used my experience to develop my own “unbeatable” stock-picking system. I spent half a dozen years and hundreds of thousands of dollars to make sure it’s highly accurate, comprehensive, and effective.
And my system scans nearly 5,500 stocks every day, looking for the best of the best that big institutions are likely buying by the truckload. I use 80 complex algorithms to score and rank each one of them for strength across 29 factors.
It’s a very powerful system… Since 1990, on average, it’s identified half of the top 5% of names in the S&P 500 each year – including the No. 1 stock on the S&P 500 for the past six years in a row.
Now, when a stock triggers unusual institutional (UI) buy signals – the footprints I believe big-money players leave when trying to quietly get in and out of a stock – my system goes green. And it looks like this…
If you’d bought NVIDIA when my system first flagged it on June 2, 2000, and held it until today, you’d be up 1,660%. And it doesn’t always take decades to make these types of gains, either…
In less than a year, my Palm Beach Trader subscribers were sitting on five doubles and two triples – including The Trade Desk (up as high as 211%) and Paycom Software (up as high as 120%).
Patience and Process
I once asked a multibillion-dollar hedge fund manager how he could stand pat, waiting for the right price on a stock he wanted. He simply replied, “Patience and process.”
What he meant is: You don’t need to spend all your time and energy constantly rebalancing your portfolio.
You just need to find the outliers (process) and hold them (patience). Years of data and research back this up.
So if you want to get rich in the stock market, find the best companies that the smart money is likely buying up. Then, pretend you’re dead.
When you awaken, you’ll be sitting on a fortune.
Editor, Palm Beach Trader
P.S. To beat the market, you simply have to buy the right stocks and hold on. In fact, this “zombie” method could’ve turned $1,000 into millions. And my system can pinpoint these exact types of stocks before anyone else.
To prove it to you, I’m putting my system to the test tonight at 8 p.m. ET. I left Wall Street after nearly 20 years to develop this system so I can help you make more money with more certainty.
It’ll help you take the luck and guesswork out of investing. And to find out how, all you have to do is reserve your spot to attend my exclusive system-testing event right here.