Nine Reasons Investors Lack Confidence (and How To Get Around that for Bigger Profits)
I hear frequently from investors all over the world, many of whom want big profits but lack the confidence needed to achieve ’em.
Today we’re going to talk about why that is and cover a confidence-inspiring trade set-up that can help put you on the path to consistent profits.
The threat of a reversal is very real, the looming pension crisis very scary, a trade war, a real war… and more. This stuff is a real mule-kick to the gut if you don’t have the confidence needed to be a successful investor.
Being here is a great start.
You’re part of a huge family of like-minded folks who are passionate about being profitable and about building the kind of wealth most folks will dream about but never achieve.
That’s a huge advantage because it means you’re constantly taking in new knowledge that gives you an edge over investors who are trapped in the past or who think they know it all.
Take your buddy – you know the one – who’s telling you how dangerous the stock markets are right now because they’re “expensive” or “overvalued”… despite the fact that he or she has failed to invest in the world’s best companies and missed every penny of the profits since 2009, when the current bull market rose like a proverbial Phoenix from the ashes of the Global Financial Crisis.
Or, take your colleague who’s constantly telling you about the risks of picking specific stocks because he or she “just buys” the index and – predictably – never enjoys the 100%, 200%, or even 300% winning plays that come from companies like Chevron Corp. (NYSE:CVX), Insperity Inc. (NYSE:NSP), and Biogen Inc. (NasdaqGS:BIIB) – all of which are real recommendations I’ve highlighted in my services, incidentally.
Those naysayers are trying to rationalize their lack of results by messing up yours.
This is unique in the financial world.
It’s also why you constantly see “lists” of top stocks, top performing mutual funds, ETFs and the like at your favorite bookseller or magazine shop, especially at the beginning of every New Year.
The key to lining up big profits is twofold.
First, you’ve got to recognize what I call “confidence-undermining performance limiters.” And, second, you’ve got to have a rock-solid analytical tool you can use on any stock at any time to help you overcome ’em.
Let’s talk about the confidence-underminers first.
Generally speaking, there are nine…
…wrongly interpreting results
…too much risk
…lack of accountability
…bad investing ethic
…no repeatable process
…not knowing the numbers
These are all pretty self-explanatory things we’ve discussed before, so I’m not going to spend a lot of time on ’em today.
Save one thought.
Clearing your head of negative influences is quickest, most certain path of profits. It’s also far more likely to lead to financial success than listening to your buddies, despite their obviously well-meant intentions.
Especially when it comes to having the confidence needed to hunt down the world’s best investments and make your move for huge potential wins in just about any market conditions you can think of.
The path to profits and huge wealth is very clear and based on a single, simple premise – money is always on the move, and profits are never far behind.
The only question is how you identify that consistently and confidently.
My favorite tool is centered on “velocity.”
That’s a $5 word for “momentum” and, I think, a much better descriptor with regard to when money’s on the move in today’s markets.
Let me explain, then show you what I mean.
Many investors were taught years ago to wait for a pullback or a correction, then make their move. And unfortunately, many of those same folks still think that works.
In reality, such thinking is about as relevant as a Sony Walkman when it debuted in 1979. Further, it’s all impossible in today’s highly computerized markets.
Things are more like a dogpile now, and you’ve got to be “in to win” when the scrum starts or miss out on the biggest, most profitable parts of every move.
That’s where velocity comes in.
It doesn’t matter whether you’re talking about a $5 stock or a $5,000 stock.
If a stock is going up… you will know it and have the confidence to do something about it in the pursuit of profits.
Because the money you’re looking for will be on the move.
I run a sister research service called High Velocity Profits, and this simple idea plays a key role in why it’s so successful. Readers, for example, have had the opportunity to capture a stunning 25 winning triple-digit plays this year alone, just to give you an idea.
My favorite tool for identifying velocity is a technical indicator called the “Aroon.”
Created by Tushar Chande in 1995, the Aroon means “new dawn” in Sanskrit, and it’s a great way to detect when a stock is beginning a new trend or about to change direction.
The Aroon works simply enough by calculating the number of periods – months, days, hours, ticks – since a stock has achieved a new high and returns a percent value indicating the time since a new high has happened. The higher the value, the stronger the trend’s potential.
It’s powerful confirmation.
Three Examples Using the Aroon for Maximum Profits
I recommended Biogen Inc. (NasdaqGS:BIIB) on June 8 of this year, following a perfect “Green X” shown by the Aroon. Readers following along had the opportunity to capture 204.55% as they scaled out of the position less than a month later on July 6, even as the S&P 500 fell by 0.38%.
I recommended Methanex Corp. (NasdaqGS:MEOH) on March 28, and readers following along had the opportunity to capture 100% when they converted their holdings to a “Free Trade” by selling half the position on April 11, taking the original capital off the table, and letting the rest ride.
And, I recommended Audentes Therapeutics Inc. (NasdaqGM:BOLD) on March 21, which fell immediately, while allowing readers who were following along to capture another 100% while simultaneously converting their position to another Free Trade less than a day later.
Up, down, or even sideways.
If you can figure out which way the velocity is working, then you know right away which way the money is moving and can place your bets accordingly.
That’s something we talked about just last week with Harley-Davidson Inc. (NYSE:HOG) as part of my thinking on how to play a stock that’s in serious trouble (and there are plenty of those around at the moment!)
The great thing about this is that velocity – momentum – tends to work in all time frames, which means you can use it to invest on a longer-term horizon just as easily as you can use it to trade on a shorter-term one.
If that’s not confidence inspiring, I don’t know what is!
Normally, I wouldn’t be so blunt with an upsell like that, so please forgive me, but I thought the most effective way to make my point would be to use real-life examples. Click here to learn more about High Velocity Profits and join the Family.
Now, there are obviously some caveats.
One of the hardest parts of learning something new – especially when it comes to a subject we like to think we know a lot about like investing – is that stuff like this can seem so abstract.
You have to practice “reading” your screens to uncover the market’s hidden profit potential.
That’s why I want you to grab a cup of your favorite libation and sit down at your computer for a moment. Click on over to your favorite financial site and pull up a chart.
I don’t really care what chart or even which stock you use.
Next, add the “Aroon” indicator study – it’s included for free on many of the top financial sites like Yahoo! Finance. Pick the company ticker, see the chart on the main screen, click on that, and under the “indicators” tab, you’ll select “Aroon.”
Then, change tickers and pick a dozen companies that are mentioned in headlines you grab at random from your favorite financial news provider. Heck, insert your favorite stocks.
Experiment with various time frames – daily, hourly, even tick level data.
I think you’ll be stunned by just what an eye-opener this will be.
And, of course, what an edge velocity can give you when it comes to consistently identifying the world’s best profit potential.
Until next time,