The System That Tells Me When To Buy AND When To Sell

As some of you may know, I write a newsletter called Maximum Profit. In this advisory, I employ a proprietary trading system that scours the universe of stocks to find ones that have the best potential of delivering exceptional returns in a short amount of time (my average holding period is six months). 

While on the surface it might seem as if Maximum Profit and my other, long-term-focused newsletter Top Stock Advisor come from opposite ends of the investing spectrum, at their core they are quite similar…

You see, in Maximum Profit, we take technical analysis (the study of charts and graphs) and combine it with fundamental analysis, and in return we get an elite system that has the uncanny ability to find solid companies that deliver fantastic returns over a short amount of time.

Before I get into the meat of today’s article, let me provide a quick refresher on exactly how my system finds and scores stocks that are then added to one of my Maximum Profit portfolios.


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How My System Finds Market-Crushing Stocks
In its most basic form, the Maximum Profit system is momentum-based. That is, it looks for stocks that have performed well and should continue performing well. It’s been proven that stocks that have fared well recently should continue doing well in the short term. In other words, winners win.

I score stocks based on their relative strength. Relative strength tells me how well a stock is doing compared to all other stocks in the market. If a stock comes in with a score of 90, that generally means it is outperforming 90% of all other stocks (the rankings range from 1-100). A score of 90 is rare and tells me that the momentum behind the share price is strong.

I then combine the relative strength rating to my fundamental indicator, which I call Cash Flow Relative Strength. And as you may have gathered from its name, I’m looking at a firm’s cash flow… and how well it is growing it. These stocks are also ranked from 1-100, with 100 being the very best.

Combined, the relative strength rating and cash flow relative strength rating give me a stock’s Maximum Profit score, or MP score. A higher MP score tells me a stock is firing on all cylinders and has a great chance of short-term gains.

2017’s Already Been A Good Year For Maximum Profit
In March, I suggested two stocks my system had recently tagged as buys. One sported an MP score of 94, while the other scored 93. Those are fantastic scores. 

You can see how those stocks — Vocera Communications (NYSE: VCRA) and Extreme Networks (Nasdaq: EXTR) — have done since then:
 

Not bad, right? But buying is only half the battle. The beauty of my system is that it not only finds stocks that I should buy, but also indicates when I should sell. And I think that’s really the most vital part of the system. 

Knowing when to take profits (or let profits run), or when to cut your losses short is probably one of single biggest factors between an average investor and a great investor. It’s also the hardest part of investing. Most investors let small losers turn into big ones or cut their profits short. But with the Maximum Profit system, it takes the emotion out of the equation. 

#-ad_banner-#This time around, instead of giving you just two stocks I’m going to provide you with the scores of some of the most popular stocks on the market. You can then see and track how these stocks do depending on their score. 

This has become a wildly popular feature of Maximum Profit. Sure my readers like to have the step by step guide on which stocks I’m buying and selling in my portfolios as well as a model portfolio that they can copy. But recently — at my invitation — readers have been sending me stocks that they would like me to score. These could be other stocks in their portfolio, stocks they’ve been watching, or simply popular stocks they hear about in the financial media every day. In fact, this service has become so popular among my readers that I’ve made it a regular feature.

So today, I’d like to share with you a list of some of the most popular stocks that I’ve been asked to score. Keep in mind that not every stock listed here would be a “Buy” under my system’s criteria, but it’s interesting to see where they stand.

So without further ado, here’s the list of popular stocks and their scores:
                           

Company Ticker Close 6-14 52W Low 52W High RS Rating Cash Flow RS Rating MP Score
Apple AAPL $145.16 $91.50 $156.65 86 49 68
Alphabet GOOGL $967.93 $672.66 $1008.61 79 38 59
Berkshire Hathaway BRK.B $171.45 $136.65 $177.86 52 22 37
*Amazon.com AMZN $976.47 $682.12 $1016.50 82 87 85
Facebook FB $150.25 $108.23 $155.59 82 28 55
*Tesla TSLA $380.66 $178.19 $384.25 95 88 92
*Alibaba BABA $136.67 $73.30 $148.29 91 73 82
General Electric GE $28.69 $27.10 $33.00 29 10 20
Microsoft MSFT $70.27 $48.04 $72.89 69 95 82
Intel INTC $35.53 $30.44 $38.45 47 62 55
Ford Motor F $11.22 $10.67 $14.04 26 33 30
AT&T T $38.72 $36.10 $43.89 39 58 49
Cisco Systems CSCO $31.60 $27.13 $34.6 54 91 73
Johnson & Johnson JNJ $132.77 $109.32 $133.56 74 20 47
Pfizer PFE $32.69 $29.83 $37.39 55 19 37
General Motors GM $34.61 $27.34 $38.55 37 39 38
Chesapeake Energy CHK $5.02 $3.93 $8.20 14 99 57
Bank of America BAC $23.76 $12.05 $25.80 54 11 33
NVIDIA NVDA $151.72 $44.57 $168.50 92 67 80
Netflix NFLX $152.20 $84.50 $166.87 81 12 47
*MP Holding              

 

And here’s the really good news: My publisher has authorized me to offer a special rate to try Maximum Profit. When you pay for six months of my service, I’ll send you my recommendations for a full year. Yes, that means you’re getting a year of winning stocks delivered to your inbox at half price. 

For more information (and the chance to get your own stocks scored by my system), click here.