Each week, Director of Education Steven Primo presents 2 classes to explain
PowerRatings (for Traders), and to guide traders in using PowerRatings correctly
and efficiently. Steven breaks down his classes into 2 categories -
The Advanced class focuses on our
2 Rules to Improve Your Trading, which is based on additional research
released this year that dramatically improves your PowerRatings (for Traders)
edge. The Introductory class outlines what PowerRatings (for Traders) are, and
gives a few general guidelines to getting started with PowerRatings today.
Steven outlines 3 basic strategies in the introductory session.
Focus on Stocks with High PowerRatings. PowerRatings (for Traders)
ranks stocks from 1-10. Stocks with a PowerRating of 10 have, on average,
outperformed the S&P 500 by a 14.7 to 1 ratio over the past 11 years. Stocks
with a PowerRating of 1 have underperformed the S&P 500 by a 5 to 1 ratio.
Clearly, the historical edge lies in stocks with a PowerRating of 10, so you
want to be focusing on stocks with a PowerRating of 7-10, which guarantees you a
historical, quantified edge.
Avoid Stocks with Low PowerRatings. This strategy goes hand in hand
with the first strategy. Stocks with a low PowerRatings (for Traders) have
significantly underperformed the broader indexes, so it would be wise to stay
away from stocks with a PowerRating of 1-3. Aggressive traders could consider
using these stocks as a short opportunity, but make sure that you are
comfortable with the additional risks that come with short-selling stocks.
Find More Trading Opportunities with PowerRatings Heat Maps.
PowerRatings Heat Maps give traders an automatic snapshot of sector strength and
weakness, and also allows traders to focus all the way in to see individual
stocks. By displaying PowerRatings strength and weakness by looking at overall
groups, traders can quickly and easily asses what areas of the market look set
to move, and which ones to avoid.
Finally, Steven always emphasizes that you should use PowerRatings (for
Traders) as a confirmation tool. It would be unsafe to just click on the
9’s and 10’s link, and automatically buy each stock on the list. Start your
trading day with an action plan or strategy; traders lose their shirts when they
trade without a plan. Check out our
PowerRatings (for Traders) Portfolios to learn more about our trading
strategies built around PowerRatings (for Traders).