Free eLetters

August 2018

Probability Series #1: The Medical Doctor Who Beat Roulette

August 14, 2018TradeSmith Research Team

Understanding probability means knowing how to put the odds in your favor. This can help you generate reliable investment returns over time. Probability can also mean the difference between “investing” and “gambling.” Two people can be playing the exact same game. Yet one of them is investing … and the other is gambling … based on the fact one knows how to use probability and the other does not. We see this routinely in the real world. There are professional

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July 2018

Cognitive Bias Series #4: The High Cost of Thinking with The Wrong Brain

July 31, 2018TradeSmith Research Team

Did you know that you have two brains? Or that “thinking with the wrong brain” is a problem investors face … which costs them a lot of money? You don’t literally have two brains. It’s not like there’s a spare somewhere. But the human brain has two different “systems,” which Daniel Kahneman calls System 1 and System 2. Kahneman is an Israeli-American psychologist notable for his work on the psychology of judgment and decision-making, as well as behavioral economics. The

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Cognitive Bias Series #3: What Israeli Air Force Pilots Can Teach Us About Investing

July 24, 2018TradeSmith Research Team

Even the best investors in the world can benefit from TradeStops. We know this because we’ve extensively tested the results. We track the stock portfolios of multiple billionaires — most of them investment legends — and the data has shown that, generally and over time, our software could have substantially improved their already excellent performance. That leads to an interesting question. Why is this the case? How is it that even the smartest investors on the planet can benefit from

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Cognitive Bias Series #2: Debunking the Myth of “Rational Economic Man”

July 17, 2018TradeSmith Research Team

Imagine the following scenario: You meet your new neighbor at a barbecue and say “So, what do you do?” as you hand him a beer. He tells you that he studies Bigfoot. “But I thought Bigfoot was a myth,” you say. “Have you ever seen Bigfoot?” Your neighbor says no, he’s never seen Bigfoot. He further admits, with a shrug, that Bigfoot is just a figment of imagination — an idea that is completely made up. But still, he studies

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Overcoming Your Greatest Obstacle to Investing Success

July 10, 2018TradeSmith Research Team

If you’re like the average investor, you’d say it’s easy to feel overwhelmed at times by confusion in the markets — and sometimes even by fear. But why should it have to be this way? Investing is a noble pursuit. Generating wealth for a comfortable retirement means creating the financial freedom to live well in the golden years … while providing support to loved ones … enjoying the finer things in life … and possibly making a real difference in

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June 2018

56% Winners is Great. 60% Winners is Incredible. 64% Winners is Amazing.

June 19, 2018TradeSmith Research Team

A few weeks ago, we published updated statistics for our Stock State Indicator (SSI) signals. Our test presented what would have happened if someone had bought a stock when the SSI Entry signal was triggered on the upside and exited that stock when the SSI Stop signal was hit on the downside. Very simply, using the Stock State Indicator signals over the 22-year period of time gave us 56% winning trades! And the winners continued to outperform the losers by a 5–1 margin. We were thrilled

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Behind the 39% Per Trade SSI Numbers

June 4, 2018Lisa Lenda

Last week, TradeSmith shared the results of our latest testing on the Stock State Indicators (SSI) as an investment tool and the efficacy of the SSI Entry and SSI Stop signals. The results were incredible. Our test group included about 1,300 tickers (stocks, indices, funds and commodities). Of the more than 9,700 trades that triggered SSI Entry signals, 56% of the trades were winners. Even better, the average winner outperformed the average loser by an almost 5–1 margin. The average

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May 2018

39% per trade… over 22 years!

May 29, 2018TradeSmith Research Team

Almost two years ago, in August 2016, I first presented the results of an exhaustive study that demonstrated the power of the Stock State Indicator (SSI) signals. This might have been the most important piece of research we had ever done at TradeStops. As we showed you here, going back to 1996 and covering almost 1300 tickers (individual stocks, indices, and commodities), we measured the effectiveness of the SSI signals as an investment tool. Very simply, our test showed what

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January 2018

Making More with Less

January 2, 2018TradeSmith Research Team

The holidays are behind us now. It’s time to get to work trimming down… your portfolio. As I’ve been saying for much of the past year, individual investors have incredible advantages over large investors and institutions. One of those advantages is the ability to have more concentrated portfolios. We’re going to start 2018 off with some strategies for trimming down your personal portfolio, but first I’d like to share with you even more inspiring evidence that when it comes to

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December 2017

Trimming an Overloaded Portfolio

December 19, 2017TradeSmith Research Team

Obesity is an increasingly global epidemic. Our consumption-driven economy has led us to believe that we must try a little bit of everything… and many people are simply trying to consume too much. While “a little bit of everything” may work for what we put on our plates for a holiday banquet, it’s a woefully inefficient strategy when it comes to our investments. In fact, I believe portfolio concentration is one of the great opportunities we enjoy as individual investors.

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July 2017

Do Less. Make More.

July 4, 2017TradeSmith Research Team

Would you like to do less and make more? In almost any area of life and business, the answer to that question is a no-brainer. Right? When it comes to the stock market, however, sometimes passive investing can get you farther. Unfortunately, when it comes to investing, most people seem to want to “do more and make less.” That, at least, is what the evidence suggests. Overtrading is one of the cardinal sins of the individual investor. I’ve known this for a

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March 2017

Turning the clock back by 6 months on U.S. stocks…

March 24, 2017TradeSmith Research Team

Many would-be investors are feeling left behind by the U.S. stock market these days. What if, however, you could turn the clocks back on the U.S. markets by six months? That’s exactly the situation that we have with European markets today. With U.S. stock markets hitting all-time highs, money is finally moving off the sidelines and into the markets. A good friend of mine has been too scared to get back in the markets for a while. Last week he

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