I take an unique approach to markets. It took me a long time to figure this out. I had tried everything from technical to fundamental analysis. However, I believe the way to be successful longer term is by finding overvalued and undervalued assets and trying to get into them early in new trends or just before they reverse course. This is difficult and you must be disciplined in your approach when you trade markets this way. The video below gives a small example of how I look at markets.
With the market about as overvalued as it has been in its history one must be very careful. However, we can still pick away at undervalued companies and look to short the overvalued market and companies (with puts and carefully traded ETFs).
I think due to the overvaluation in the market we are going to see a big bust. To protect against this I have created a small portfolio of strategic put options. The way I have structure this portfolio is I have hand picked about 5-6 companies that I feel are vastly overvalued and can fall hard in a market decline. Calling for a market decline is tough especially in today’s world when the central banks are so determined to prop up asset prices.
However, valuation still matters, one reason the market is flat in the last 7 months is because it is just too overvalued. Companies can buy back stock and the Fed can print all the money it wants if stocks are fundamentally overvalued they will stop going up in price.
It may sound outlandish but the companies I have picked out as potential put hedges have a history of collapsing in down markets. If you get a down market many of these stocks will fall 40,50 even 70 or 80 percent and the profit can be huge, in the hundreds even thousands of percent. In addition, if you find an overvalued company it collapse even in an up market.
Even in overvalued markets you can find certain stocks and sectors which are cheap. While I am very patient due to the markets overvaluation I am looking at stocks and sectors to add positions to purchase in the fall which I think will be great buys (which a lot more potential than the entire market). Actually, we have just found one that we think can jump a great deal in the next year. I expect to add longs in beat up sectors in the coming months especially aggressively in the fall.
If you are interested in out of the box thinking and techniques to make money in bear and bull markets our service is for you.
With Addicted to Profits you receive
1. 20 Issues a Year
2. Weekly, Podcasts, Videos and Email Alerts
3. Trades on Options and Stocks with specific buy and sell points
4. Company Recommendations
5. Watch List of stocks and options
6. A 3 month trial to our short corner service with a 4 month subscription and a 6 month trial with a year subscription (valued at $625 and $1250) .
Our service is for both long term and short term traders. You can pick what you like from our services.
This deal will only last until Sunday and please note this is the only time I will be offering a free trial to our short corner short selling service which is one of the only one of its type that know of. This offer will only last until Sunday!