Chris’ note: They call him a Market Wizard…
From 1990 to 2010, trader Larry Benedict didn’t have a losing year. It earned him a place alongside Wall Street legends like Ray Dalio, Paul Tudor Jones, and Ed Thorp in the 2012 book on the world’s greatest hedge fund managers, Hedge Fund Market Wizards.
Larry now shares his trades with subscribers. And last year, as stocks tanked, all his advisories finished in the green. One even gave his subscribers the chance to make a 240% gain on cash.
How did Larry do it? He focuses his trades on just 32 specific days of the year that shock the market…
There are 32 days a year that really matter for traders.
On those days, one of two things is happening…
The government releases important economic data. Think inflation numbers and jobs reports.
Or the Fed decides on interest rates.
Each of these days has the potential to send a shock of volatility through the market…
This allows traders to snap up bigger gains than normal, as stock prices shift.
I call these days “Money Shocks.”
That’s because the stock market can move 20x more than usual on these days.
Lately, it’s been moving even more than normal. And it’s led to some of my biggest trading wins.
For example, in September 2022, I handed my subscribers the chance to close out a Money Shock trade for a nearly 145% gain.
In December, I did it again… for a 174% gain in just two days.
So today, I’ll draw back the curtain on those two trades. And I’ll show you how you can follow my next Money Shock trade.
One of the key planks of my trading strategy is called mean reversion.
I look for stocks that have overshot in either direction… and profit when they snap back toward their average – or mean.
This works for trading stock indexes such as the Nasdaq and the S&P 500, too.
Let’s look at that 174% gain, for example…
Over the past year, inflation – and the Fed’s rapid interest rate hikes to halt it – has been one of the biggest stories in the market.
That’s why, each month, there has been a massive build-up to the release of monthly Consumer Price Index (“CPI”) numbers. It’s Washington’s official inflation measure.
Any hint that inflation is slowing has set off a false narrative…
The market keeps expecting lower inflation readings to stop the Fed raising rates.
But so far that hasn’t happened…
And this gap between what the market expects… and reality… has created some great Money Shock setups.
One of them was on December 13 last year. That’s when the Bureau of Labor Statistics (“BLS”) released the CPI reading for the previous month.
Inflation came lower than expected… stocks overshot to the upside… and I sent a trade alert to my subscribers to bet on a fall in the S&P 500.
Take a look…
And after that initial burst of optimism faded, the S&P 500 fell sharply.
And thanks to the “leverage” – or extra oomph – of options trading, that resulted in a gain of almost 174% in two days.
And that wasn’t my only triple-digit trading win on a Money Shock day.
Another opportunity came last September…
The S&P 500 had begun to rally in early August after the start of earnings season. It’s when companies release their sales and earnings figures to the world.
Then, on August 26, at the Fed’s annual conference in Jackson Hole, Wyoming, Fed Chair Jerome Powell reminded everyone that the Fed wasn’t going stop raising interest rates.
And as you can see in the chart below, this caused the S&P 500 to tumble.
S&P 500 Index (SPX)
Source: eSignal
But stocks surged again in September. And I knew that it was time to pounce…
On September 12, the day before the BLS was slated to release its new CPI numbers, I sent a bearish trade alert to my readers.
And it worked…
The next day, inflation came in higher than expected. Investors realized they’d been sucked into a false narrative. And the S&P 500 gapped lower.
Less than 24 hours later, I sent an alert to close that trade for about a 145% gain.
The S&P 500 didn’t fall that much. But again, I used the power of options trading to leverage its move lower for a triple-digit win.
The bear market started in January 2022. Since then, I’ve recommended my readers close out 89 successful trades like this.
And over the last 12 months I’ve logged gains in my model portfolios of…
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112% in 8 days
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38% in 2 days
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53% in 1 day
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125% in 11 days
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144% in 1 day
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145% in 3 days
Trading these Money Shocks will be a core part of my strategy in 2023. There’s nothing close to them in terms of the gains on offer.
And they’re even more lucrative in bear markets, like we’re in today. That’s because bear markets tend to have higher volatility – and higher potential trading profits – than bull markets.
And the next Money Shock day is right around the corner…
That’s why I’ve created my Money Shock Calendar event. I’ll show exactly how I go about trading these days. And how to follow my trades.
It will air tomorrow, February 22, at 8 p.m. ET. And it’s free to attend. All I ask is that you RSVP here with one click.
Once you do that, you’ll be able to download the Money Shock Calendar I’ve created.
It will populate your calendar app with all 32 Money Shock days for 2023.
If you’re interested in boosting your trading returns… or offsetting losses in the buy-and-hold part of your portfolio… please set aside some time to join me.
I can’t wait to see you then…
Regards,
Larry Benedict
Editor, Trading With Larry Benedict