My Easy 5 Minute Trading Strategy to Make $10,000/Month (Backtested Results)

In today's video, I'm going to show you my relatively easy 5 minute investing strategy that if done right, can make you ten grand a month or more. There's no sitting at a desk all day, no stressful chart watching and no confusing techniques. If you're fed up of complicated methods and just want a predictable way to trade, then this is for you. All you need to do is is know three simple numbers and a quick five step checklist and that is it. I'll even show you some examples on the charts with all of the results so you can see exactly how well it works. My name's David Bell. I've been a trader for 15 years and I like to keep things simple. Let's dive straight in. Now, just to be clear, this strategy is designed specifically for trading US stocks. But even if you're trading FX or considering it, I'd recommend sticking around for just a minute. Because FX usually means dealing with rapid price changes, unpredictable news and juggling dozens of factors at once. But the approach I'm showing you today lets you slow things down. Trades play out over weeks or months, not minutes. And you can focus on just one company at a time with a few simple systematic rules. You take your profit and move on. Simple, focused and stress free. But what is this simple strategy and how does it work? Well, there's two parts actually. There's the 1 4, 10 method and then there's the five step checklist. We'll go through the first part and then the second. You need to understand both for this to work. So the 1410 methods, yes, it sounds a little bit gimmicky, but it really is the foundation of everything that we want to be doing. What you do is you pick one country, the us. It is the country with the deepest capital markets. It is the country with the deepest liquidity, which means that you can trade really, really easily for such super low costs. And also the US is a growth monster. It means that the companies are going to be returning cash in the form of dividends to shareholders probably at the fastest and best rate than anywhere else in the world, which translates to capital flowing there, which means that the price of their companies is most likely going to go up and to the right out of any other nation or economy out there. The four in the strategy is how we determine trend and this is actually how commodity trading advisors do it as well. Something we will come on to a bit later. The moving averages that you use are the 20 for short term movements. We then use the 50 for sort of short to midterm movements, the 100 for slightly longer term and then the 200 for seeing the really, really long term trend. To understand exactly where the specific stock is trading across different durations, the 10 in the strategy is where we're looking at US large cap stocks above $10 billion in market cap. The reason we want to do this is because if something has reached $10 billion in market cap, it means that they have a fantastic business, other investors really, really want to buy them. And also it means that they're likely to be a legacy business and quite integral actually to the functioning of the market and more broadly the US economy. Now I mentioned commodity Trading Advisors a little bit previously. Previously, but what exactly are they? Well, these guys tend to run a multi asset portfolio, not just in commodities but across stocks, perhaps fixed income, so bonds, fx, sometimes they're quite prevalent in. But for our purposes we want to focus mainly on the US equity side. Now how they do things is pure trend following. And actually the bank Associate General, which is a French bank, they have an index which actually shows the returns of CTAs over certain time periods. And what we tend to find is that CTAs are in fact the most successful segment of the institutional market. The reason why is because they are purely systematic. You might see macro hedge funds for instance, who tend to make bets based off of what the economy's doing, relatively subjective aspects of the market. Whereas what CTAs will do is they will use moving averages, they will use things like sector valuations, they will focus on volume and just be very, very systematic with all of their rules, whether it's a trade generation, so your signal, or whether it's actually managing the trade based off of certain risk parameters. They'll also look at position sizing based off of things like volatility. They will also make sure that their correlations across assets aren't all leaning the same way. This can really prevent blow ups and allow for a bit of a scale smoother equity curve. It's actually been found that if you hold eight stocks in a portfolio, you're largely reducing a massive amount of volatility as long as your correlations are all very, very different. Now of course there's more to this because it would be way too easy if all you're doing was focusing on four moving averages and thinking oh yeah, that is the trend, which is where the finc academy does come in. But, but let's go a tiny bit deeper just so you can get a hint of where we're headed with this. I Just wanted to welcome our sponsor, Tickmill. They're an FX and CFD brokerage who also offer futures and options. They offer FX and CFDs on over 600 different asset classes and they've been in the industry for years. If you are interested in opening up a futures and options account or FX and cf, then do click the affiliate link below. So now that you know how you pick the right group of stocks, how do you actually know which ones to trade? Because we're relying on these stocks going up in the medium to long term. And I don't know about you, but I don't want to be sat at a desk watching the news all day. So that's where our five step checklist comes in. And if all five factors are met, there is a positive trend and it's worth parking your money in it to make make a bit of profit. The first one is of course the moving averages that I've mentioned, but I haven't actually mentioned how to use them. What we're looking to do is have the market close above the 200, the 50, the 100. And for the actual signal to occur, we're looking for the market to pass through and close above the 20 daily moving average or weekly if you'd like to extend your time frame more 20 to ensure that we know that there is a brand new signal occurring in the short term. We don't want old signals. What we also then need to do is understand volume. We have to understand if other people are interested in buying this stock as well, because if they're not, it's not going to go anywhere. What we do there is we take the last 20 days moving average of volume. We then say, okay, well is this daily volume 10% or more above that last 20 days moving average volume? If so, we've got a signal to dig deeper and see if there is actually something that we can take from this signal that can generate an idea that will lead to us being able to hold a stock for three months minimum. These are the time frames that we operate off of. We do not want to get into short term punting because that tends to just be noise where you're eaten up by the likes of Citadel, Jane street, you've got the likes of point 72. These guys are all operating on such super short time frames where they are competing with technology latency, a room full of quants who are all PhDs in astrophysics. You do not want to operate on these time frames because you will get eaten alive. I used to do this and in 2019, 2020 my edge intraday completely went. Many people face the same issues. Kent Bray, who used to be a managing director at Citi, who I know well, he was actually Gary Stevenson's mentor. He said to me on LinkedIn just the other day that he was managing director and a fantastic trader when he was at Citi he tried to do it himself and it was a disaster. So take that advice and perhaps look at extending your time frame in the way that I'm advising you to do. So so far we've gone through what stocks to do trade and how to pick the right ones in a simple easy to follow process. But does this actually work? Do I have proof of it working? Yes and yes we run a model portfolio. So let's take a look at some past examples so you know that this can make you money again and again. Just wanted to give a shout out to our sponsor Leverage Shares. They provide leveraged ETPs on a wide range of products from shares to gold to oil, nat gas, you name it they've probably got it. And this is something for more short term moves. Do check them out if you are a little bit more of an aggressive investor and would like to juice your portfolio a little bit. So in front of you here you can see the Fink model portfolio and it started at about £7,000 because that tends to be what most people invest with. And this was based off of a survey that we did with quite a few people who are relatively new to markets and they said yeah, we've got between five and ten grand. So we took an average. You can see now that with our picks it's up to 17£378.44 which is pretty good over a year now you can also see some of the picks that we've had. GoDaddy in fact is not showing the correct total gain because we trade in and out of it. So this is showing the newest position on GoDaddy which we re entered about a month, two months ago. So what you will see here if it was actually the full position was about 100%. Now we hadn't exited anything on Robinhood which is why it shows 102% gain. And with all of the others we've been trading in and out as well, specifically with on holding AG2 which is a fantastic company. So I want to show the example of GoDaddy because this was a truly excellent investment from our perspective. Now as you can see on the chart what we had back on 7th March 2024 was this formation here where we saw the market sort of dipped below the 20 moving average. And then we got our signal. Our signal was right here, you can see that price exceeded the 20 daily moving average plus the volume. But there were a few other factors which I can kind of delve into now that caused us to believe that this would be the right investment to take. Now what we tended to do was to take a full position right away because we're focused on on trend. We do not care about sort of the gyrations in the shorter term. We don't care about reducing our position size and then increasing. We just care about trend. And so with GoDaddy they were trading underneath their sector average price to earnings, which means that basically they were probably going to have to play catch up to the rest of the sector. This was a fantastic signal for us at the time. Not only that, but they had a moat. They are one of the largest domain providers in the world. And on top of that they had the AI narrative following as well. These are objective things that you can track because we know that the AI narrative is objectively one of the biggest momentum factors at the moment. We absolutely know that it's undeniable. And also we can say that, okay, if we're looking at the likes of a cta, for instance, who would be using a factor like price to earnings, price to book, price to sales, to deduce whether a trend might be strong or weak as well, because they know that other participants are going to be focused on this valuation metric and therefore probably going to have a go and buy them as well. They're systematic, they do not necessarily care about anything subjective. Then we can shift the probability into our favor. This is all you're doing with this. You're focused on trend. Trend is something that we know makes money. It's probably the only thing that makes money. And we're looking at output performance, we're looking at beta performance, we're looking at beta extraction. This is really what we're up to. And so this was really the case for the investment. We're relying on the fact that we know US equity markets like to drift up and to the right. We're reliant on the fact that the S P500 is a market cap weighted index which means that it rebalances heavily based on the top stocks involved, which leads to upside drift for pretty much any everyone else as well. And we're really, really focused on the fact that the US is the capital destination of the world. And for GoDaddy that is really what leads to the outsized performance. Those couple of factors are essential. Now there's an interesting thing that happened though, because right away we dipped below the 20 moving average. What do we do there? Well, all we DO is take 25% of the position. Oh, no. But then it went straight above again, you add it back on. The transaction costs are not big enough to really and truly eat into your position here. They really are not that big a deal because we're dealing, and we've got the advantage of we're dealing with smaller capital sizes than the large institutions. The large institutions have transaction cost analysis desks focus on how much slippage they're getting, what is the complete cost of trade. And they have to do this because they're dealing with such large sums of money. We don't necessarily have to do this because we can enter and exit the market so cheaply. We do not have to worry. And so throughout this trend, you can dip in and out, in and out, in and out. And this is just basically reducing your position size. As you see some volatility, tick up, negative volatility, that is. And it keeps you holding peace of mind. And bear in mind this is a daily chart. So you're really getting a signal for this about three weeks later. It might look really short term, but it's not. And so if you're able to set up and systemize absolutely everything, this is going to be in your favor. You're going to be trading like one of those CTAs, because believe me, this is what they're doing. They're focused on trend and, and deploying capital in and upwards, sometimes downwards. If they are a long, short cta, they're purely focused on trend and they do not care about anything else. Systemize it and you will do well. Let's move on to the second example, which has been the absolute standout for us, which was Robinhood. So Robinhood we bought on the 19th of February in 2024 and this was and still is just a fantastic investment. There are a couple of reasons as to why we did this. And the first, obviously is because it popped up as a signal. You can see we bought it here and we actually executed this on the weekly, which would show that the weekly candle or bar closed above all of the moving averages. With the sufficient volume, you can see that jump up there. There's a little gap you can really, really see closely. And the key reason for us to get involved in Robin Hood, the subjective reason as to why we bought it is because we knew that US interest rates were coming to a peak. This basically meant that people had priced in all of the rises in the US base rate and that this could now provide a much more risk tolerant environment. Robinhood is a very, very high beta stock, as you can see, which means that it's very volatile. It moves more than a benchmark, like the S&P 500 for instance. And so this was a key part of our portfolio because we needed to include something high beta that also aligned with that lovely trend following system that we have. From this perspective, it's been a complete blockbuster for us and you can see that it's had some absolute dips and we've traded again in and out of it. But the beauty of using a systematic trend following system is even if you're out of the position, the trend can kick back in again. The rules of the are there for you to be absolutely obliged to take the trade when they tell you to, even here. Again, exactly the same. And so what I hope you're starting to see here is that you have to remove any kind of doubt from your head in the fact that trend is the way to focus on things and systemizing entries and exits according to the trend is the absolute way to go about things. Now, there's other reasons as to why we took this, which are very much explicit explained in the Think Academy alongside the rules for getting in and out and also understanding position, sizing, concentration, risk and everything else that you really, really do need to know. Another stock we've really favored is Stonex. Now, if you don't know anything about them, they're a brokerage and a fcm, so they do futures, custody and broking and things like that. And we like them because they're very much a real purveyor in the industry alongside Robin Hood from for instance, of technology and technology backing. But people don't really know the actual size and scope of Stonex. They're absolutely huge. Now you can see where we've bought them back in July and this is a decision that was difficult over the time because we were very much in and out almost every other week. Now, not completely out of course, because the only time we get completely out is if we close below the 200 daily move and average. So every time it goes back above certain moving averages, we get back in. Of course with that though, there was a lot of turnover, but I'm sure you can see the trend there. We're not always expecting it just to ride above the 20 daily moving average forever. What we want to do is make sure that we are protected according to the volatility of the market. So we reduce position sizes as volatility increases obviously to the downside and increase it as it increases to the upside. This is beta extraction. This is what we want to be doing. We want to be be extracting volatility as the market moves up and then getting out and making sure that our downside is completely covered. But you can see here that it's had a fantastic ride. We've gone all the way from about 50 bucks to trading at 93 bucks at the moment. So that's nearly 100% gain over almost a year now actually. Well, it is over just over a year. So again, another fantastic trade. And look, these are companies that lots of people don't even think about investing in. We don't care what the company is necessarily. There are caveats to that. What we care about are the systematic rules and whether it makes sense from a data perspective to get involved. These are not random punts. We're not betting here. We are making sure that we are putting our money into places where we know the system is going to allow us to have the highest probability that to make gains like this, that's all it's all about. We do not need to be sitting there all day, every day looking at lines going up and down. We just need simple alerts and a system that we know is focused on harvesting things that are going to make money over time in ways that we know work. So now you know exactly how to use the 1:4,10 strategy in the simple five step checklist to pick winning stocks. You've also seen proof through those three clear examples. So give this a try yourself and let me know how it goes. But before you do, I think you need to take a look at the Think Academy where we delve into this in serious, serious detail and get people going from complete beginner up to being able to do this themselves for life. This is what we want you to do. We don't want you to be reliant on us. We want you to know how to do all of this. And that's exactly what we teach in the Think Academy. Look, there's 50 videos for you to go through which include all of the strategy, not just the foundational stuff that you see here. It includes going a little bit deeper alongside spreadsheets to help you calculate things like risk management and to also help you calculate things like correlation and whether there's concentration risk. These things might sound too complex, but you do need to know them and this is why so many retail traders fail. If you don't know these things then you're missing out. And there's also 15 hours on top, top of that of me speaking with a very, very intimate group over a series of months webinar style whereby you can understand the full context in real time about what we're talking about. Now before you go, I'd click below and have a look at the Think Academy. This is where we get into the topics so much deeper. This is just the foundations. This is just what I think you sort of need to know to point you in the right direction. The Fink Academy is where we compound on all of this and on top of that you get lifetime support as well with everyone else that's in the academy with me and my colleagues and we go through any questions that you might have. Make sure you click below, have a look at the academy and I'll see you next time.