As many of you know, something we've been working on internally is using various bottom-up tools and scans to complement our top-down approach. It's really been working for us!
One way we're doing this is by identifying the strongest growth stocks as they climb the market-cap ladder from small- to mid- to large- and, ultimately, to mega-cap status (over $200B).
Once they graduate from small-cap to mid-cap status (over $2B), they come on our radar. Likewise, when they surpass the roughly $30B mark, they roll off our list.
But the scan doesn't just end there.
We only want to look at the strongest growth industries in the market, as that is typically where these potential 50-baggers come from.
Some of the best performers in recent decades – stocks like Priceline, Amazon, Netflix, Salesforce, and myriad others – would have been on this list at some point during their journey...
What a day, gains of more than 1% for the major indices across the board.
Yesterday, at around 2:45 p.m. ET, I alerted Swing Trader Pro Members in Rangefinder that I bought the $SPY at 363.80. My target was 368. We hit over 372.
With Bonds getting destroyed this year, it's put pressure on growth stocks, because of their long-duration characteristics.
As rates rise, it puts a lot of pressure on growth stocks. That's why historically the more Value oriented stocks and sectors tend to outperform when rates are rising.
When rates are falling that's when growth stocks usually thrive the most.
We all know this. The data is free.
BUT, a funny thing has happened over the last few months.
With bonds continuing to collapse and breaking those summer lows, the Nasdaq has been outperforming the S&P500.
From the Desk of Steve Strazza @sstrazza and Alfonso Depablos @Alfcharts
In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but not both.
We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.
Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.
We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades.
What remains is a list of stocks that large financial institutions are putting big money behind.
And they’re doing so for one reason only: because they think the stock is about to move in their direction and make them a pretty...