How to Build a Million Dollar Stock Portfolio Investing in Value

Buffett Speaks

Re: Use this 6 step checklist to spot fortune building value and momentum stocks before Wall Street’s Ivy League analysts.

You and I both know insider trading is illegal

But that’s not to say it doesn’t happen.

It does.

All the time.

And most often, it happens with smaller stocks that the average investor knows nothing about.

Companies like Ambarella (AMBA). Students watched me identify this company back in 2013 when it was trading at $12 a share. It had surged from $7 in a few months for no reason. No earnings report. No other news.

Then there was news that Ambarella was suddenly a big player in the high tech industry. It was producing the perfect technology for hot new wearable cameras.

It soared to $60.

Let’s face it. Somebody knew something.

And that’s just one trade.  Imagine if you had insider information on not just one stock, but five or ten. Fact is, you’d become very wealthy in a short period of time.

How to Profit With The Insiders Without Breaking A Single Law

6 Step

Here is further proof of hidden stock fortunes from the years before 2010 deep inside the last crash.

Had you bought right when the “insiders” did, you could have made $178,000,000 in 5 years. Every $37,580 invested became three quarters of a billion in just 60 months.

There is a way to know when a stock is garnering inside attention without breaking any insider trading laws. It’s a secret I’ve been using with a great deal of success for several years.

I’ll tell you about it in a bit.

But before I reveal it to you, you need to ask yourself a rather profound and deeply personal question: “Is trading this way ‘ethical‘?

The answer depends on you.

Yes, you are profiting using a technique that detects and exploits possible insider activity. But the way you are obtaining your information is perfectly legal.

You know nothing you’re not supposed to know. You’re simply following a trend being set by people who most likely have information nobody else has.

If you’re not comfortable trading this way, I fully understand. And I respect your position.

But if you’re tired of insiders getting all the profits

…and you want to learn how to beat them at their own game — entirely within the confines of your laws — you’ll want to read on.

Because in the words ahead you’ll learn how you can do it … and could rack up some very handsome profits along the way.

Perhaps the Most Powerful Trading Secret on Wall Street

But first, let me tell you a little about Denny’s (DENN).

I was doing my usual quarterly chart reading of the roughly 3,700 worthwhile stocks trading on the NYSE, AMEX, and the NASDAQ exchanges. A highway diner stock named Denny’s caught my eye.

As before with Ambarella, there was no earnings report released and none due for several weeks. There was no announcement. No news of any kind. But the volume had surged along with the share price.

I did some digging. I found that the company had re positioned itself as “America’s Diner” under the hands of Frances Allen who was proven from the helm of Dunkins’ Brands (DNKN).

The spike in volume told us two things were highly likely:

  • either a buyout, or
  • insiders were withholding their shares from the market restricting supply against mounting demand.

As word leaked out, people close to the situation snapped up shares. To us, this volume spike was as good as insider information.

Even better. It was perfectly legal!

You can probably guess what happened. Denny’s share prices have risen over time from $2.25 then to $11. In one month nearly 4 billion shares traded hands. You could have more than quadrupled your money in less than 5 years.

But here’s the thing. I knew that the investing public, ever hungry for good news and the next rags to riches story, was driving this stock higher than it deserved to go. The new CEO was good news, but not great news.

Also the earnings were weak when I first identified this trade. But a few months later I noticed a significant improvement.

Denny’s continued to rise.

Ride These “Spikes” For What They’re Worth and Then GET OUT!

Denny’s (DENN) and Ambarella (AMBA) are perfect examples of how you can profit following insiders using volume spikes and price trends.

But it’s important to know that this is purely a timing strategy. It is not a buy and hold portfolio.

When a volume spike arises — and the research checks out — ride it until you see signs that the fervor is fading.

Then get out. Take whatever profits you may have.

A Remarkably Effective (And Amazingly Simple) Scientifically Proven Way to Predict Significant Stock Price Moves Before They Happen…

Sometimes investors are rewarded with 400% returns in a year — like the gains in Ambarella (AMBA) and Denny’s (DENN). Other times they’ll make 100% in a few months …

or 1,000% in a few years, as you saw was possible above …

My point is, trading on volume spikes requires you to employ a stock trader’s most powerful weapon: discipline. You’re only in for the up-elevator.

Usually the ride is quick or you are stopped out. But it is never a “buy and holdsituation.

Here’s something else to remember. Trading using volume and price is not passive.

It is fast-paced. It is exciting.

And the scientifically proven potential for big speedy gains are tremendous…

[SEE FOOTNOTE]

Let me give you another very recent example.

Facebook (FB) is a large cap internet media company. Facebook held one of the biggest initial public offerings (IPOs) in technology and Internet history on May 18, 2012.

The stock immediately slumped crashing more than 50% over the next few months. Then in the summer of 2013 Facebook (FB) traded above the $38 listing price on high volume and strong earnings.

On No News Strangely It Rose

In the end of the summer of 2013 the price had extended upward enough on consistent volume to merit a test purchase.

The price continued to climb so I bought more.

Over the next few months I scaled into a large stock position in Facebook. The price climbed even more and I replaced the shares with options.

This one trade would yield more than a 140% gain on account by February of 2014.

Warren Buffet Value Investing

Continue reading.

 

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