An old trader once told me, “Trading is the hardest easy money you’ll ever make.” In theory, trading is easy enough — all you have to do is buy low and sell high, right? After all, there are thousands of books claiming to have all the information we’ll ever need. #-ad_banner-#In practice, however, trading is among the most difficult activities in the financial world. Despite the availability of a wealth of information, few do it well. In fact, all that accessible information actually makes it harder to trade successfully. Think about that for a moment. If you could really win… Read More

An old trader once told me, “Trading is the hardest easy money you’ll ever make.” In theory, trading is easy enough — all you have to do is buy low and sell high, right? After all, there are thousands of books claiming to have all the information we’ll ever need. #-ad_banner-#In practice, however, trading is among the most difficult activities in the financial world. Despite the availability of a wealth of information, few do it well. In fact, all that accessible information actually makes it harder to trade successfully. Think about that for a moment. If you could really win in the markets by simply buying stocks with low price-to-earnings (P/E) ratios, then we would all be successful. As an old trader also once told me, “To know what everyone knows is to know nothing.” If everyone has the same tools, it’s difficult to use them to gain an advantage over everyone else. The secret to beating the market — and your fellow investors — is to use little-known indicators, which act like secret weapons for trading. That’s why I developed my own indicator, which I call the Income Trader Volatility (ITV) indicator. ITV is similar to the Volatility S&P… Read More

The list of global events keeps piling up: A recent U.S. airstrike in Syria and bombing of ISIS in Afghanistan, increasing tensions with North Korea, a pivotal election in France that could determine the future of the European Union, talk of a renewed healthcare push in Congress (and tax reform in the works), the list goes on… But the world keeps turning and money never sleeps. And in today’s article, I’d like to do something a little different and tell you about how one of my fellow StreetAuthority experts developed one of the most reliable indicators I’ve ever seen. I’m… Read More

The list of global events keeps piling up: A recent U.S. airstrike in Syria and bombing of ISIS in Afghanistan, increasing tensions with North Korea, a pivotal election in France that could determine the future of the European Union, talk of a renewed healthcare push in Congress (and tax reform in the works), the list goes on… But the world keeps turning and money never sleeps. And in today’s article, I’d like to do something a little different and tell you about how one of my fellow StreetAuthority experts developed one of the most reliable indicators I’ve ever seen. I’m talking about Amber Hestla, Chief Strategist of Income Trader. I’d like to give you a little background on Amber and how she developed this indicator — which has delivered winning trades 93% of the time — and then tomorrow, you’ll have a chance to hear Amber talk about this indicator in more detail herself. Introducing Amber Hestla For those who aren’t familiar, Amber is one of the most well-respected options experts in the United States. But in her former life, she was a military intelligence operative. I’m not kidding. The transition from that to a… Read More

My years in the military have allowed me to see the world in a totally different way. While deployed overseas I tracked IED locations, went on convoy missions and gathered intelligence from local villages. I learned the importance of analyzing data to forecast what was likely to happen, and I used this information to determine the level of risk our soldiers were dealing with. #-ad_banner-#My service opened my eyes to the bigger picture — not just in the military, but in everyday life. My experience assessing risk in the military taught me to think outside the box and take different… Read More

My years in the military have allowed me to see the world in a totally different way. While deployed overseas I tracked IED locations, went on convoy missions and gathered intelligence from local villages. I learned the importance of analyzing data to forecast what was likely to happen, and I used this information to determine the level of risk our soldiers were dealing with. #-ad_banner-#My service opened my eyes to the bigger picture — not just in the military, but in everyday life. My experience assessing risk in the military taught me to think outside the box and take different approaches to problems or situations, including the financial markets. Today, there are myriad investing techniques and strategies. And when I was first introduced to them, like most I found myself overwhelmed. That’s where my training came in handy because I was able to look at the market from a different angle. As I put my years of service analyzing data and forecasting and assessing risk to work, I was instantly drawn to one particular strategy… selling put options. Options can be powerful income-generating tools — safe enough even for retirees — when used correctly. Here’s an easy way to understand… Read More

I recently strolled into my neighborhood McDonald’s to satisfy my dreadful McNugget addiction. The assistant manager immediately recognized me, not for my nugget-purchasing frequency, but my appearances on Fox Business Network. After the 25-year-old interrogated me for 10 minutes about investing in today’s target, I realized it was time to short it. Our conversation was the coup de grace in a series of indicators all pointing to lower prices for this ETF. And don’t worry, I told her it wouldn’t be a good idea to buy it in the short term. #-ad_banner-#For as much flack as McDonald’s gets, the restaurant… Read More

I recently strolled into my neighborhood McDonald’s to satisfy my dreadful McNugget addiction. The assistant manager immediately recognized me, not for my nugget-purchasing frequency, but my appearances on Fox Business Network. After the 25-year-old interrogated me for 10 minutes about investing in today’s target, I realized it was time to short it. Our conversation was the coup de grace in a series of indicators all pointing to lower prices for this ETF. And don’t worry, I told her it wouldn’t be a good idea to buy it in the short term. #-ad_banner-#For as much flack as McDonald’s gets, the restaurant chain has provided many with some very powerful ideas in the world of finance. Back in 1986, The Economist conceived the “Big Mac index” as a means of measuring global currencies against one another for a quick inflation check. In January 2017, the average Big Mac in America cost $5.06, while that same concoction of meat and cheese in China sold for just $2.83 (when you converted yuan to U.S. dollars). In simple terms, the Big Mac index indicated the yuan was undervalued against the USD by 44%. Useful information if you’re contemplating a currency trade… but what about stock… Read More

No matter how much we think we know what to expect, there are always surprises. As an investor, I know this means I have to look at all the information available, rather than assume I know what the data says. That’s what led me to find an investment opportunity in an unexpected place: retail. This is a sector filled with bad news. According to CNBC, “Retail bankruptcies march toward [a] post-recession high.” So far this year, we have seen nine major retailers file bankruptcy, including Limited Stores and the parent of Radio Shack, which already went bankrupt once before. Analysts… Read More

No matter how much we think we know what to expect, there are always surprises. As an investor, I know this means I have to look at all the information available, rather than assume I know what the data says. That’s what led me to find an investment opportunity in an unexpected place: retail. This is a sector filled with bad news. According to CNBC, “Retail bankruptcies march toward [a] post-recession high.” So far this year, we have seen nine major retailers file bankruptcy, including Limited Stores and the parent of Radio Shack, which already went bankrupt once before. Analysts believe other will follow. Moody’s Investors Service says that 19 retailers are distressed and may not survive the year. Their list includes 99 Cents Stores, Payless, Claire’s, David’s Bridal and, of course, Sears. Some investors may want to avoid the entire sector, but there must be some winners hidden among all the struggling stores because retailing can’t disappear completely. While looking over relative strength screens of the market, I was surprised to see one company doing well in one of the more beaten-down sectors. Best Buy (NYSE: BBY) has been a market leader for the past six months, the only… Read More

It’s one of the easiest and safest ways to generate 20%-plus returns on a regular basis. Once you’ve mastered the technique, I wouldn’t be surprised if you stopped trading stocks or only buying and holding investments altogether. #-ad_banner-#That’s how powerful this strategy is: It can drastically improve the way you make money in the markets. That goes for conservative income investors and aggressive traders alike. The technique involves selling options. If you’ve never tried your hand at options before, don’t worry — the kind of options strategy I’m talking about is perhaps the safest, easiest way to execute a trade… Read More

It’s one of the easiest and safest ways to generate 20%-plus returns on a regular basis. Once you’ve mastered the technique, I wouldn’t be surprised if you stopped trading stocks or only buying and holding investments altogether. #-ad_banner-#That’s how powerful this strategy is: It can drastically improve the way you make money in the markets. That goes for conservative income investors and aggressive traders alike. The technique involves selling options. If you’ve never tried your hand at options before, don’t worry — the kind of options strategy I’m talking about is perhaps the safest, easiest way to execute a trade for income that you’ll ever come across. Specifically, I’m referring to selling call options. A call option gives the buyer the right — but not the obligation — to buy a stock from the call seller if it’s trading above a specified price before a specified date. When you sell a call option, you accept the potential obligation to sell a particular stock at a specified price at a set time in the future. When you sell a call, you generate what I call “Instant Income,” also known as a premium, upfront. I only recommend selling covered calls. A covered… Read More

If you’re not familiar, OPEC is group of 13 oil-producing countries that collude (in the most legal of ways) to help control oil prices (i.e. keep prices at levels where they can make the most money by selling the most product the market will bear). Love them or hate them, they do control more than 80% of the world’s oil reserves. But their influence is becoming less powerful, as they only account for less than half of global oil production. #-ad_banner-#There’s been a lot of whoop-dee-doo about OPEC’s recent decision to cut oil output, and even non-OPEC members are supposedly… Read More

If you’re not familiar, OPEC is group of 13 oil-producing countries that collude (in the most legal of ways) to help control oil prices (i.e. keep prices at levels where they can make the most money by selling the most product the market will bear). Love them or hate them, they do control more than 80% of the world’s oil reserves. But their influence is becoming less powerful, as they only account for less than half of global oil production. #-ad_banner-#There’s been a lot of whoop-dee-doo about OPEC’s recent decision to cut oil output, and even non-OPEC members are supposedly getting in on the action to scare oil prices higher. Fortunately for us, these scare tactics are mostly baseless. The deceptive headlines seem ominous, but the data reveal the truth. These “massive cuts” really only bring production down slightly from record levels and are only temporary. Even excluding U.S. production, oil is still being pumped at near record amounts. OPEC’s “cuts” still leave production higher than it has been in all of history. OPEC sneakily boosted production leading up to the cut to make it look like they were really doing something drastic — but it was all a shell… Read More

Many of the traders I talk to are wondering what Bill Ackman could be thinking. Ackman is a hedge fund manager, the founder and CEO of Pershing Square Capital Management, which has about $11 billion under management. Ackman is considered a contrarian investor who tends to buy when companies are down, and an activist investor who sometimes takes a role in managing companies he invests in. He has achieved incredible success by some measures and has a reported wealth of about $1.4 billion. Ackman recently shared a chart showing his performance with investors… There is an obvious problem… Read More

Many of the traders I talk to are wondering what Bill Ackman could be thinking. Ackman is a hedge fund manager, the founder and CEO of Pershing Square Capital Management, which has about $11 billion under management. Ackman is considered a contrarian investor who tends to buy when companies are down, and an activist investor who sometimes takes a role in managing companies he invests in. He has achieved incredible success by some measures and has a reported wealth of about $1.4 billion. Ackman recently shared a chart showing his performance with investors… There is an obvious problem with recent performance. As Ackman explained, “The substantial decline in performance from August 2015 through March 31, 2016 is largely due to Valeant’s decline…” Valeant is now the investment traders are talking about. Ackman took a large stake in Valeant Pharmaceuticals International (NYSE: VRX) as the company was growing rapidly through acquisitions. The strategy largely relied on buying other companies and then raising prices, a tactic that we know was widespread in the drug sector. But regulators began to question the strategy after it was discovered VRX was using in-house pharmacists to potentially overbill insurance companies. Traders reacted to the… Read More

If you’re like the typical American, you’ve probably got a closet full of stuff you simply don’t wear anymore. And if you’re female, statistics show you may have a few more “unwearables” than men. According to ClosetMaid, the average woman has more than 100 items in her closet, yet finds 21% of those items unwearable. That means clothing and footwear designers have to work extra hard at keeping our attention, especially if their lines cater to women, as today’s target does. If you’re a company that produces “unwearables,” chances are your customers aren’t coming back to… Read More

If you’re like the typical American, you’ve probably got a closet full of stuff you simply don’t wear anymore. And if you’re female, statistics show you may have a few more “unwearables” than men. According to ClosetMaid, the average woman has more than 100 items in her closet, yet finds 21% of those items unwearable. That means clothing and footwear designers have to work extra hard at keeping our attention, especially if their lines cater to women, as today’s target does. If you’re a company that produces “unwearables,” chances are your customers aren’t coming back to add more. But before we go pointing fingers at either sex or even at the fast-changing, mega-consumer society we live in, let’s remember one key element that’s always influenced our lives and the clothes we wear: style. From the flapper dresses of the early 20th century to the bell-bottoms of the ’70s, clothing styles can change dramatically from year to year. And some, (thankfully) never come back. Clothing styles can shift dramatically from year to year, and these shifts can bankrupt a clothing company. Changes in style helped steal the mojo from hip companies like Urban Outfitters (Nasdaq: URBN) and… Read More

There are a lot of hard problems facing Washington. Healthcare will take time, as will many other issues. Tax policy seems to offer the most immediate path to a significant accomplishment for the president and Congress. President Donald Trump has made a number of proposals related to taxes. Among the most important would be a reduction in the highest corporate income tax rate from 35% to 15%. I am fairly certain tax reform will require negotiations and Trump won’t get everything he wants. But the good news is that lower corporate and personal income taxes seem likely. #-ad_banner-#Lower corporate taxes… Read More

There are a lot of hard problems facing Washington. Healthcare will take time, as will many other issues. Tax policy seems to offer the most immediate path to a significant accomplishment for the president and Congress. President Donald Trump has made a number of proposals related to taxes. Among the most important would be a reduction in the highest corporate income tax rate from 35% to 15%. I am fairly certain tax reform will require negotiations and Trump won’t get everything he wants. But the good news is that lower corporate and personal income taxes seem likely. #-ad_banner-#Lower corporate taxes will have an immediate impact on company earnings. Standard & Poor’s estimates that every 1% reduction in the corporate tax rate could add 1% to the earnings per share (EPS) of companies in the S&P 500. However, Trump isn’t looking for a small reduction in taxes… he’s targeting a 20% drop. Let’s assume he settles for a rate in the middle, a 10% cut. EPS for the companies in the S&P 500 could then be about $146. A P/E ratio of 17 provides a price target of about 2,500. A P/E ratio of 20, which could easily be justified by… Read More