Our Latest Breakthrough â A Seasonality System for Growing Profits, Year After Year We talk a lot about seasonality here in Power Trends... and weâll talk more about it in 2025.
Why?
Because it helps us make money. Weâd be fools to ignore patterns that occur with enough regularity to turn them to our advantage.
And besides, we discover seasonality through data, which is much more accurate than gut feelings, fear, or greed.
Up until now, seasonal patterns mostly related to the market as a whole. But thanks to an impressive new tool from TradeSmith, we can now identify and use seasonal patterns to our advantage right down to individual stocks. All with just a few clicks.
It reminds a lot of my Quantum Edge system, which tracks Big Money inflows across the entire market but also down to specific stocks. I discovered the powerful advantage that gives me long ago, and this tool looks similarly powerful.
Iâve had the good fortune to give it a try, and you can bet I will incorporate into my analysis and stock recommendations in the future.
Best of all, you as a Power Trends reader can also try it out for free through the holidays, and I wanted to be sure you were aware of this unique opportunity.
Let me turn it over to TradeSmith CEO Keith Kaplan, who oversaw the development of the tool, so he can tell you more about how it works, what it has revealed about some specific stocks, and how you can give it a try... ◆ ◆ ◆ ◆ ◆ Investors often hear about the Santa Claus Rally, the January Effect, and the advice to âsell in May and go away.â Market history tells us September brings declines and flash-crashes, while November through April are the best six months for profits from the S&P 500 each year.
As you said, Jason, those are all examples of âseasonalityâ in the stock market: recurring periods of growth or weakness that happen with such astonishing frequency that theyâve become expected, annual events. Like handling plants in a garden, there are times to harvest, and there are times to sow seeds and wait for new growth.
But seasonality doesnât just apply to the big indexes. Every stock has its own âseasonsâ to grow or decline. A kind of summer... and a kind of winter, too. Repeating year after year.
Itâs fair to be skeptical: that level of consistency sounds too good to be true, right? If this was the case, why werenât these patterns common knowledge?
Well, to put it simply: it takes a lot of data to identify seasonality trends in individual stocks. But when you see market seasonality in action, the strength of these trends can blow you away. The Power of Market Seasonality I was certainly surprised last fall, when one of our programmers here at TradeSmith emailed me with a simple request: to watch Nvidia (NVDA) stock on Oct. 24.
This programmer had been conducting historical research that projected that, starting that day, Nvidia was set to rise an average of 7.8% over the next 15 days. This pattern had occurred 100% of the time over the past 15 years.
So, I watched the stock. I didnât know of any obvious catalyst for that day â no scheduled company announcement, no Fed meetings... No product demos... nothing.
But sure enough, on Oct. 24, 2024, Nvidia shot up â just as our programmer projected. Over the next 15 days, it rose 5.1%.
Now, Iâm a data scientist â so immediately, I started asking questions.
And when I sat down with that programmer to discuss the results, he walked me through the data on NVDAâs price movements. Clear as day, for the past 15 years, Nvidia shot up during that 15-day time span, starting Oct. 24, every single year. There was a 100% hit rate across that period:
15 years â that stretches back all the way to 2009. Back then, Bitcoin had only just debuted, and the idea of an AI industry, or an AI trade... it was all science fiction at best.
Nvidia was just a company chugging along, making graphics cards for video games and media editors. But still, it kept rising in late October, regardless of news or attention... year after year.
Now, on its own, a 5.1% gain isnât much.
But, if you could repeat that modest gain every 15 days, using consistent historical patterns like we saw with NVDA, thatâs the equivalent of making 120% each year. More than doubling your money â while the S&P 500 averages an annual return of just 10.26%.
Each trade wouldnât even have to be very large.
There are plenty more of these seasonality cycles waiting to be found out there, hidden in the data of thousands of different stocks. And my team has developed a new strategy to capitalize on them â built around a system that can track and chart the most optimal seasonality patterns of the year, like our own âFarmerâs Almanacâ for the stock market.
Iâll be hosting a webinar to go into more detail on the strategy in January â and, leading up to it, Iâm making our seasonality tool available so you can check these historical patterns yourself.
You can sign up to attend the webinar here â completely free â and after you sign up, make sure to try the tool for yourself.
Itâs revolutionary, even compared to the rest of TradeSmithâs suite of software and investment tools. And it works on more than just Nvidia. The Right Seasonality for Growing Profits Our historical research showed that Tesla (TSLA) and Broadcom (AVGO) jumped each May. Advanced Micro Devices (AMD) did great in November.
Allient was a great buy in October... but it was a bad idea to buy NeuroMetrix (NURO) that same month.
Finding these opportunities took a lot of searching. So, I dedicated our entire research and development team â 74 people in total â to the task of serving up these cycles automatically.
The resulting algorithm runs 50,000 tests per day to analyze every single stock in the major indexes, find the ones with the strongest seasonality trends, and point us to the best opportunities â down to the day.
As we backtested this strategy, we realized that trading these stocks at their very best times of year wasnât just a novel approach â it was an incredibly effective one.
Over our 18-year backtest, these seasonal trades delivered 857% in total growth: more than twice what the S&P delivered over the same period. Even in 2007, the strategyâs worst year, it delivered an annualized return of 37.9%.
It worked year after year, pointing you to the best times to trade each stock.
Amazon (AMZN) is another great example. Between May 24 and July 13, AMZN has gone up 100% of the time over the last 15 years, with an average return of 10.26%:
If you bought shares at market close on May 24, 2024, for $180.75, selling at the end of the period on July 12 wouldâve delivered 7.6% in profits... and if youâd sold near the seasonal peak on July 5, you would have earned 10.65%.
I could show you examples of these seasonal patterns all day. Weâve uncovered seasonality cycles in stocks, indexes, even currencies and commodities â and weâre one of the few firms that can crunch enough data, the right way, to identify the very best seasonal trades.
If we wanted to, we could easily launch a hedge fund of our own, built around this tool.
But at TradeSmith, weâre not interested in that type of business. Instead, weâre offering regular investors and traders access to try this powerful software. Putting Power in Your Hands By helping individual investors and traders determine the best day of the year to buy a stock... and the best day to sell â weâre giving everyone the chance to put the power of seasonality to work for them. Until Wednesday, Jan. 8, you can click here to try our Trade Cycles seasonality tool â for free.
Iâve got plenty more to share about the tool and our full Trade Cycles service in the coming days.
Click here to save your spot now for our Jan. 8 event at 10 a.m. Eastern, where Iâll go into even more detail.
Youâll also get to try TradeSmithâs Seasonality tool for yourself, free of charge for a limited time.
That way, you can start harnessing these powerful seasonal cycles, planning the entire trade in advance, so you can buy and sell with confidence.
All the best, Keith Kaplan
CEO, TradeSmith |
