I know it hasn’t felt like it the last two months, but the truth is that this year has far exceeded expectations.
Even with a nearly 7% pullback in August and September, the S&P 500 has surged 20% in the last 12 months.
I hope you got in on some of those gains, but I know a lot of folks didn’t. A record of nearly $6 trillion remains uninvested in stocks.
Now is the time to make up lost ground… or better yet, build on what you’ve already made this year.
My data says stocks are soon about to heat back up, and when even a chunk of that cash comes back in, it provides more fuel for a bigger launch.
And… the recent volatility means great companies are on sale.
But time is running out to grab some of the highest quality companies in the market at these lower prices.
Here are three important reasons to get ready now if you want to make the most money these next few months.
Wall Street already knows this game, so you might as well get in on the profits, too.
#1: Stocks Always (Almost) Gain in the Fourth Quarter
I’m a data guy. Some is compelling; much of it is inconclusive.
The data showing fourth-quarter strength is very compelling, and therefore highly predictive.
Going back to 1990, stocks (the S&P 500) move higher 75% of the time in the fourth quarter. I’ll take those odds most anytime.
In fact, the historical win rate in my Quantum Edge system for individual stocks is 70%. Making money on seven out of every 10 stocks is a proven wealth-building formula.
Fourth-quarter market data is even better at 75%. And when the market is that likely to move higher, the highest-quality stocks in that market offer even higher odds of success.
The market’s average return for the last three months of the year is also compelling – a stunning 5.1%. To put that in context, stocks on average generate half of their yearly return in the fourth quarter alone.
It all adds up to the highest probability of the biggest quarterly gains of the year. That’s why you want to be invested by early October.
#2 Folks Think Stocks Are Too High – And They’re Wrong
Coming into 2023, the whole market worried about inflation, rising interest rates, and what a lot of people felt was an imminent recession. My data never forecast such gloom and doom, but a lot of folks thought it had to happen.
The economy defied forecasts. Stocks kept rising. Big Money kept buying.
Realizing how much they underestimated stocks, many analysts have been forced to revise their year-end targets higher.
My research has clearly shown that positive momentum almost always leads to more positive momentum. That’s true of stocks and indexes. Its Newton’s first law of motion applied to stocks: Stocks in motion tend to stay in motion.
My friend Luke Downy, who co-founded our research firm MAPsignals.com with me, dug into scenarios more specific to this year and found even more proof that now is the time to buy stocks.
The S&P 500 gained 17% through August of this year. Luke discovered that the bellwether index gained 10% or more in the first eight months of the year 16 other times since 1980. That’s a healthy-sized dataset to analyze, which increases its predictive value.
And this data shows that more gains are even more likely than seasonal data indicates.
Of those 16 times with 10% gains through August, the S&P 500 continued higher in the fourth quarter more than 81% of the time. The average gain was 4.9%, which is almost exactly what seasonal data shows.
Notice those full-year returns, too. If this year were to match that 23.3% historical average, the S&P 500 would need to surge 10% in the fourth quarter alone.
That’s not as crazy as it sounds. It happened in six of those 16 previous years.
I’m not predicting that, but I’ve said all year that this fourth quarter could be pretty spectacular – and one that investors don’t want to miss.
#3 Earnings Are Working, And Wall Street Knows It
Through all of the “will there be a recession” turmoil, companies have consistently exceeded expectations.
When reporting second-quarter results, 79% of S&P 500 companies made more money than analysts said they would.
This wasn’t just last quarter. It happens all the time. The five-year average shows 77% of companies beat estimates.
And after a stock beats Wall Street’s arguably intentionally low estimates, something else happens. This phenomenon has been studied, and it’s called the “post earnings announcement drift.”
Studies show that stocks drift in the direction of the earnings surprise for up to one year after the announcement.
In other words, Wall Street, through its coverage and estimates, has the opportunity to influence the action in a stock for up to one year.
You can make a lot of money in a year, which means the opportunity extends beyond just the next quarter.
I’m convinced that Wall Street is about to engineer this upcoming earnings season to become one of the most profitable yet – for them anyway.
It can also be for the rest of us who know the game.
These Are the Stocks to Buy
I see a real opportunity directly ahead for investors to recoup losses, add to gains, or even just get their money working for them again if they’ve been sitting in cash.
It’s not too late… yet. But time is running short to make the most of what’s coming.
I encourage you to invest in stocks with the Quantum Edge trifecta of superior fundamentals, strong technicals, and Big Money inflows. These stocks are mostly likely to make you money in any market conditions… but even more money in a rising market.
Big Money activity is especially important in figuring out those post-earnings drifts. Institutional trading accounts for between 70% and 90% of all volume, so you want to be swimming with the current and not against it.
In my investing services, we’ve scooped up these kinds of elite stocks at bargain prices, which both increases profit potential while decreasing risk.
We’re already seeing excellent results, even as volatility continues. For example, we’ve added four stocks in my Quantum Edge Pro service the last two months as buying opportunities emerged. The average gain on those four stocks is 3% in a time when the S&P 500 is down 3%.
But we expect a lot more in the coming months.
You should, too. And now’s the time to get ready.
Jason Bodner’s Power Trends
P.S. One of the stocks I recently recommended was my answer when I asked recently where I would invest a million dollars right now.
It’s a small tech stock that meets all of our quantum criteria… and it’s my favorite play on the massive AI boom that has already created $5 trillion in new wealth.
I put all of the details in a new report called M.A.P.’s #1 Move for the $5 Trillion A.I. Reckoning.
Click here to learn how you can access it today – along with all of recent recommendations – and get yourself ready for a fun and profitable fourth quarter.