I Made My First $100k Using This Simple Strategy (Backtesting Proven Results)

Hi, my name is David Bell and I've been trading for about 14 years now. And I've tested hundreds of strategies over that time and nine times out of ten I've lost money. But I eventually found one strategy system or method that actually allows me to make a hundred grand plus per year. It's made up of just three numbers, 1, 4, and 10. If you understand these three numbers and, and implement what I show you, you will become a profitable trader. So in this video, we're going to go through the exact strategy that makes me multiple six figures a year, how to take my exact strategy and actually earn with it, and what to do right after this video to become profitable. So let's get into it. Listen, I bet you've all tried to day trade before. What I'm talking about is not day trading. Get this into your head. What we're talking about really is proper investing in trading. This is how many of the institutional fund managers do it and anyone who has made money consistently over the years. We are not looking to gamble on really, really short time frames. What we're looking to do is invest in one country. One country is the U.S. why do we want to focus on the United States? Well, the United States has the most deep capital markets and liquidity out of any market in the world. What that means is that capital from all around the world is going to flow towards the United States stock market. Whether that's the Nasdaq New York Stock Exchange doesn't matter. That is the place that money wants to float and therefore that gives you the best chance of placing your money in line with those flows. We're looking to use four moving averages. Four moving averages are the 20, the 50, the 100 and 200, because that means that we are looking at trend. And trend is one of the few real components that, that can actually make money continuously in markets. We want to focus on something that we can identify relatively easily, that we can make objective via our filtering, which we're going to get to, and that we can truly be able to risk manage, which is an absolutely massive part of what we want to talk about today. And we're looking at stocks above $10 billion in market cap. We want to focus on stocks of over $10 billion because it means that they have had a legacy that has made them a $10 billion minimum company. This means that they're unlikely to go away, they're unlikely to collapse overnight. So I hope you can hear where we're going with this in terms of we're just building probabilities into our favor. Let's get into actually filtering and showing you the strategy then because I think that is absolutely important. And now listen, this is going to take time to understand and get to grips with and I'm going to explain why we want to focus on this specific foundation. But once you get this base level knowledge into your head, you can build on this and using our help you will be able to become profitable. I'm using a website called barchart.com now. Bar chart is an excellent tool for screening stocks. It enables you to have so many different filters that you can, if you understand what you're looking for, ensure that certain filters match exactly the behavior of the market that you are trying to understand. We actually wrote an article for the Financial Times, it's in the FT Advisor and what we are trying to do here is to be long something called beta. We are trying to be long outperformance of the market at certain periods. Alpha is something that lots of people look for. Alpha is extremely hard to capture and as retail investors we are actually able to have a better go of just capturing outperformance the results. The reason why is because when you are a massive, massive fund, when you've got, let's say $10 billion under management, you have to find alpha. You have to be market making in certain ways. You have to be using statistical arbitrage, you have to be using things that are completely absent to the individual investor because you're competing with so much capital. You have to be able to compete against others with a load of capital. When we are individual investors, we aren't capacity constrained. We have say $100,000 account s, $10,000 or pound account sizes. This kind of capital doesn't mean that we have to go seeking for alpha. This is where we have to really, really start from. And this is the article that you can see that we wrote. Why beta outperforms alpha for retail. And really this is where every single strategy should be begun from. Basically whether you're looking just at a trend following method or you're looking at something else, you have to be focusing on, on outperforming based on momentum and beta, absolutely fundamental. If we go back to the stock screener here though, you can see some of the filters that we have placed. So what we want to do is we want to be focused purely on American stocks. We want to be focused on New York Stock Exchange and NASDAQ predominantly. The other ones don't really matter, OTC because you're not really going to get a company that is over $10 billion in market cap on the OTC. However, we have screened for a minimum market cap of $10 billion as well. Look, I understand the allure of going after small caps, you know, 100 million dollar market cap companies, 500 million dollar cap market companies. But the issue with that is that there is so much liquidity risk, there is so much risk built into these companies because they are obviously of a lower market cap. It means they haven't got that legacy. They haven't been able to actually build a business that is worth $10 billion yet. Now it doesn't make them bad companies necessarily. It's just as investors, we are wanting to put probabilities into the best chance. Basically we are looking to up our probabilities of making money over time. You can't really do that in the small cap climate. And so where we want to focus our efforts here then is on the trend. So everything that you can see here to do with moving averages is trend focused. We then want to have a volume percent change that is greater than 10% of the last 20 days average volume. Bit of a mouthful, but basically what we're trying to identify is the most recent move has basically caused the market to really be intentful about buying the stock. It's not a false breakout. These are really the things that we're focused on there. And another quick little deviation from these is that we want to have new 20 day moving average signal made. Now the 20 day moving average will move faster because it's only the average price of the last 20 days. And so when you get a new signal there, it means that we've moved according to the most recent prices. We then are looking after this for a couple of specific things which I can't really get into now, but are very, very key. This will come down to more discretionary factors such as what sector it's in, whether the sector is overvalued relative to others currently, or whether the stock is under or overvalued relative to the sector. We'll get into the current climate as well. We'll get into whether the macro regime is actually, I guess, in line with the idea that the filter and the screener is showing up. There are multiple things that we have to push into. And one of the things that I can give you for free is price to earnings. One of the best things to look at in price to earnings is whether a stock is currently really, really overvalued relative to others or undervalued. If it's very undervalued. And you're seeing these signals pop up. That is time to buy. I'll give you that for free. Now let's see what this actually spits out when we go to see results. So we've got Tyson Food, we've got Mondelez International and we've got J.M. smucker Company. So two of those are food companies. So Mondelez is a food company and Tyson Foods is a food company, obviously. Interesting. What might that mean for the sector? Oh, okay. So it might mean that people are looking at consumer staples more. What might consumer staples stocks going up mean? It might mean that there's a bit of a growth scare as people deviate away from looking at higher end product and move more to things that they're going to buy every day, such as food. If we then go and look at Mondelez and Tyson Foods, we can see exactly what we're looking at in terms of this trend move. So I've moved to tradingview here purely because I love their charts and I used to be head of growth there and I just can't escape using them. So I'd recommend also getting a Trading View account. You can clearly see the momentum trend break that I'm talking about. Okay, you can see that now. I've not got the 200 daily up here, but the 200 daily is down here somewhere. You can clearly see that we've had the shift up up above this 20 daily moving average. And because we know that the volume increase has been 10% above the last 20 days, we can see that there is some intent. Now, things that you might want to do here, you might want to go and check and see if there's news out. You might want to go and check and see if there's an earnings report. The earnings report has been really good and guidance is better, by the way. These are all things that we go through in the Academy. So don't worry too much. If you think that guidance is going to be better for the next quarter, it will absolutely increase the odds of, of this trending harder. What we're looking to do is to find the stocks out of the thousands out there with this strategy system to then enable you to make better decisions. Filter down to maybe five that might pop up each week, each month even, and then take it from there based on some things that we can then provide you in the Think Academy. This is all we're looking to do. If you are a UK user or based in the uk, you can then look at US stocks and put them in your sip Your isa. So these can all be tax efficient purchases. This is why looking at strategies like this can sometimes be so much better than day trading, even though day trading is also quite tax efficient if you're spread betting. The problem with day trading is that most people don't make any money. I've been in the industry for a good 10 plus years now and there's only been a handful of clients that I've ever seen make money from day trades. Some are very, very good, but the vast majority are not. Take what we're saying here and reduce the stress in your life and be able to make money in a much simpler and less aggressive way. So that's the strategy that made my first 100k. But part of the wider method that allows me to earn what I earn is avoiding what most traders get wrong. Most of them, probably including you, lose for a few key reasons whilst everyone else wins. Most traders lose because they don't understand actually why they are compensated for participating in the market. You're compensated by taking risks when other people don't want to. This can be based around trend, this can be based around mean reversion, something else we get into in the academy, or it can be based around some form of stats or ability to do something that someone else will not. That is the fundamentals of why you're compensated in markets. This is a complex topic and we understand that it's complex, but this is why after all of our experience, we simplify it. What we're talking about here is something called risk premium. That is a fundamental thing you have to understand. If you are participating in markets, it's why you are compensated for doing so. One of the other reasons that traders lose is by using far too much leverage. You've probably been there yourself. You know, you've got a little bit excited over a couple of wins, you've made some money, and then you decide, okay, I'm on a roll now, let's go 50x leverage on some FX. And then you lose it. I've been there. I did it in my early days as well. So focusing on nullifying these bad mistakes, bad habits, is really how you begin to build a process in line and a more successful process in line with the fundamentals, which is understanding what to actually, actually do and how to approach markets and what you're doing. The why is very, very important. The other thing as well is actually being too simplistic. Okay. What I've shown you there is all very, very reasoned, but it's been distilled from a lot of complex understanding. Okay, why do we focus on trend? Well, I understand that we focus on trend because I'm looking at risk premium. Why then do we introduce other certain discretionary factors which you can understand if you sign up for for the Think Academy? Well, because of these reasons. It depends on the context, of course, but these are all things that I have understood from 14 years of being in markets. They are very complex and what we have done is distilled them into very simple ways for you to understand it. Basically, speed runs your learning, in short, so you know what the strategy is and you know what not to do in order for it to work. But how do you actually win? What do you need to do right after watching this video to start trading profitably? Well, click the link below and have a read through because this might not actually be for you. You need to make sure that you understand what we have on offer here because this is going to fundamentally change your approach to trading and you have to be ready for that. So click the link, have a read and make sure that you understand exactly what the Think Academy is and how it's going to benefit you.