The month of May hasn’t been kind to many investors. We saw a huge decline in the Nasdaq before a steady climb back up, and some sector rotation while the S&P 500 remained passive — hardly moving an inch.
Wall Street’s old adage of “sell in May and go away” refers to the period between May and October when the market, on average, underperforms the prior six months. And this isn’t helping traders’ mindsets or profits, either. But… using the right active trading strategy is the answer to all of these problems.
Active trading is a strategy where investors try to beat the market by finding and timing profitable trades, usually holding them for just a short time.
And I want to espouse the merits of being an active trader.
A lot of the time, the talking heads find it in their best interest to remain on top of the financial ecosystem by telling traders one little lie: Don’t ever trade, just buy.
They like to tell you that you can’t predict the timing of the market, so just stay in a long position where it’s safe.
Yeah… I’m calling major BS on that.
Every trader should have different ways of making money in the market; not just buy-and-hold, long-term investments.
And if you’re the type of investor who doesn’t like to trade actively, maybe you should learn how to. It doesn’t have to be nearly as time-consuming or complicated as you might think.
We’re very much in an active traders market right now, and long-term investors are missing out on outrageous gains every single month.
When you look at the month of May’s total returns for the major indices, certain investors won’t be impressed with what they see.
The S&P 500 only had about 1% in returns, the Nasdaq is down about 1%, and the Russell 2000 is up a whopping 30 basis points.
A lot of things were happening underneath the hood of the stock market in May, but you wouldn’t know that if all your trades were just sitting for the long haul in the Nasdaq.
But on the other hand, you don’t just want to flip a coin and gamble your way into the newest meme stock, either.
Why? That same stock can also slap you with a 40% drop within 30 minutes — have we learned nothing from GameStop? AMC, the other short squeeze darling, was up 33% shortly after the open Friday… and guess what? By noon it was down 6% on the day.
So are traders’ only options to gamble with meme stocks, or remain in a slow-burning, lackluster investment?
There’s a trading strategy nestled in the sweet spot between those two extremes: Burn Notice.
In May alone, this strategy allowed us to have an 18% return on stocks and 167% on options…
And if we look at all of our returns in 2021 from this strategy, we have a 48% return on stocks and 615% on options.
This active trading strategy works… maybe a little too well.
Check out our short video below to learn more about this active trading strategy, and be sure to share your thoughts in the comments section below.
And as always, send any trading questions to email@example.com and stay ahead of the markets, especially these choppy ones, by subscribing to our YouTube channel.
P.S. We have a breakthrough trading strategy to share that is so powerful, we’ve already used it to signal 20%, 30%, even 50% winners overnight…
Every day of the week.
How do we do it? By simply buying certain stocks right at the market’s close and then selling them again the next morning.
People don’t believe us when we share our overnight strategy, but then they start digging into the 3 p.m. EDT market phenomena that we’re calling a Burn Notice.
Spot a Burn Notice at the end of the trading day — and traders could end up grabbing double-digit returns the very next morning.