A Treasure Trove of Untapped Investment Ideas

Factor research that delivers results. Published By Money & Markets, LLC. May 22, 2024 Published By Money & Markets, LLC. May 22, 2024 [Turn Your Images On] [Turn Your Images On] From The Desk of [Michael Carr]( Editor, [Money & Markets Daily]( A Treasure Trove of Untapped Investment Ideas Money & Markets Daily, I’ve spent time with many finance professors who view financial markets as nothing more than math problems. Many years ago, a professor from the University of Colorado Boulder had spent years researching options prices and presented his insights at an academic conference I was invited to. After the presentation, I asked him how he applied this to trading. He confessed that he didn’t understand any of the practical implications of his work. And this wasn't the first professor who understood the math behind the markets but had no idea how to use their research. There are a few reasons for this. The most common might be “publish or perish.” Professors must write and publish their work, or they won’t get promoted. Instead, they perish in academic obscurity. This culture leads to excellent research. However, instead of determining the next steps for their study, professors sometimes just turn to their next paper. As I learned about this, I realized that their work held untapped investment ideas. Often, professors (and especially newly minted Ph.D.s) would publish a unique strategy or system in an obscure journal to claim they published. It's just a matter of finding these ideas… I’m not the only one who understands this. My colleague Adam O’Dell has taken this to heart as well. And some of that obscure research he found formed the basis of his [Green Zone Power Ratings]( system. --------------------------------------------------------------- [Turn Your Images On]( [AI Predicts No. 1 Stock to Own]( New AI-powered stock rating system — that isolates stocks with the highest probability of producing the biggest gains — just released details on the top-rated stocks... [Details here…]( --------------------------------------------------------------- Uncover the Biggest Winners With the Right Factors Adam designed Green Zone Power Ratings to identify stocks with the potential to outperform the broad stock market. He discovered that the biggest winners from the past shared specific characteristics. In the academic community, these characteristics are called factors. A factor is a specific attribute that can influence a stock’s performance. Now, remember that “publish or perish” idea? Well, the drive to get a byline in an established publication has led to research on hundreds of factors. Many of them don’t hold up under scrutiny. Factors are defined mathematically. Understanding the math can help determine how likely the factor will be significant in the future. Some factors, especially those published by professors at smaller schools, will use bad data. Good data is expensive, and not all schools can afford it. When the goal is to publish, you use what you have. Starting with insufficient data leads to bad results, but that doesn’t mean the paper won’t be published. Hundreds of journals need content, and even weak findings can find a home. The first step for an investor is to review the factor research. If it’s low quality, we need to ignore it. This is a challenging step but also an important one. That's why Adam set out to simplify things with Green Zone Power Ratings… In building his proprietary system, Adam drilled down to only the most important factors from journals. He found six that explained the outperformance of big winners and focused on those. Those factors are Momentum, Size, Volatility, Value, Quality, and Growth. We’ll look at each in the next few weeks. Until next time, [Michael Carr]( Editor, [Money & Markets Daily]( P.S. Everyone is bracing for Nvidia's earnings report that's scheduled to drop after markets close today, and for good reason. The company is driving the AI mega trend to new heights. But Adam has identified an AI shock that could play out following NVDA's call. If you're looking for one action to take before quarterly numbers come out, [click here](. --------------------------------------------------------------- [Turn Your Images On]( [Why Silicon Valley Billionaires are Investing in This New Tech]( Jeff Bezos. Bill Gates. Peter Thiel. They’re all pouring millions into a new type of energy technology. All as ChatGPT’s Sam Altman declares AI needs an “energy breakthrough.” [Find out why one small stock could hold the key to powering AI.]( --------------------------------------------------------------- [Turn Your Images On] The Reason We Think Inflation Is So Bad A big story lately is that inflation is lower, and consumers should feel better about the economy. Politicians and economists are telling us we are in good shape. There are a lot of problems with that narrative, and the [Federal Reserve’s chart]( below shows one reason consumers remain focused on inflation. The blue line is the cost of eating out, technically the Consumer Price Index for food away from home. The green line is the Consumer Price Index, a measure of overall inflation. The difference between the two is how much more we pay to celebrate graduations and other special occasions. The rapid increase in the cost of celebrations explains why consumers feel like the economy is worse than officials tell us. — Mike Carr, Chief Market Technician, Money & Markets CPI for Food Away from Home Vs. Overall Inflation [Turn Your Images On] [(Click here to view larger image.)]( --------------------------------------------------------------- Check Out More From Money & Markets Daily: - [MEME STOCK INVESTORS MISSED THIS CRITICAL FACTOR]( - [THIS IS THE NEW NORMAL]( - [A "BULLISH" CYBERSECURITY STOCK FOR 2024]( --------------------------------------------------------------- [Turn Your Images On]( Privacy Policy The Money & Markets, P.O. Box 8378, Delray Beach, FL 33482. To ensure that you receive future issues of Money & Markets, please add info@mb.moneyandmarkets.com to your address book or [whitelist]( within your spam settings. For customer service questions or issues, please contact us for assistance. The mailbox associated with this email address is not monitored, so please do not reply. Your feedback is very important to us so if you would like to contact us with a question or comment, please click here: [( Legal Notice: This work is based on what we've learned as financial journalists. It may contain errors and you should not base investment decisions solely on what you read here. It's your money and your responsibility. Nothing herein should be considered personalized investment advice. Although our employees may answer general customer service questions, they are not licensed to address your particular investment situation. Our track record is based on hypothetical results and may not reflect the same results as actual trades. Likewise, past performance is no guarantee of future returns. Certain investments carry large potential rewards but also large potential risk. Don't trade in these markets with money you can't afford to lose. 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Box 8378, Delray Beach, FL 33482. To ensure that you receive future issues of Money & Markets, please add info@mb.moneyandmarkets.com to your address book or [whitelist]( within your spam settings. For customer service questions or issues, please contact us for assistance. The mailbox associated with this email address is not monitored, so please do not reply. Your feedback is very important to us so if you would like to contact us with a question or comment, please click here: [( Legal Notice: This work is based on what we've learned as financial journalists. It may contain errors and you should not base investment decisions solely on what you read here. It's your money and your responsibility. Nothing herein should be considered personalized investment advice. Although our employees may answer general customer service questions, they are not licensed to address your particular investment situation. Our track record is based on hypothetical results and may not reflect the same results as actual trades. Likewise, past performance is no guarantee of future returns. Certain investments carry large potential rewards but also large potential risk. Don't trade in these markets with money you can't afford to lose. Money & Markets permits editors of a publication to recommend a security to subscribers that they own themselves. However, in no circumstance may an editor sell a security before our subscribers have a fair opportunity to exit. Any exit after a buy recommendation is made and prior to issuing a sell notification is forbidden. The length of time an editor must wait after subscribers have been advised to exit a play depends on the type of publication. (c) 2024 Money & Markets, LLC. All Rights Reserved. Protected by copyright laws of the United States and treaties. This Newsletter may only be used pursuant to the subscription agreement. Any reproduction, copying, or redistribution, (electronic or otherwise) in whole or in part, is strictly prohibited without the express written permission of Money & Markets. P.O. Box 8378, Delray Beach, FL 33482. (TEL: 800-684-8471) Remove your email from this list: [Click here to Unsubscribe](