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The 5 Steps to Finding 100% Winners Like Clockwork

By Linda McDonough on January 13, 2016

Is it really possible to know ahead of time which stocks are about to launch and start quickly climbing higher?

And if so, how?

My detailed and discriminating “Launchpad Catalyst Protocol” offers a consistently predictable model for doing just that.

Here’s how it works.

Stage #1: Apply “Launchpad Filter” Across the Entire Market

First, I use a 4-factor Launchpad index to screen the market and narrow the scope of our analysis. I do this to quickly analyze the overall market looking for strong candidates.

It’s a complex formula, but the four key factors are…

  • The direction of a stock’s price change,
  • The extent of the stock’s price change,
  • The stock’s trading volume, and
  • The stock’s moving average in recent periods

The computed index accurately measures significant changes in the MOMENTUM of stocks.

Now many investors would stop after applying their momentum filters. Unfortunately, odds are you’ll gain a lot of false positives. And as a result, lose a lot of money.

Which is why I always go a few layers deeper.

Stage #2: Analyze the Competition

Next, with this group of stocks, I analyze each company’s valuation relative to peers.

I want to know…

“Is there noticeable room for growth?”

Given the stock’s momentum and room for growth, are we looking at a “high tide raises all ships” scenario? Or are we looking at a “break out from the pack” scenario?

Each stock is different. And both scenarios are viable given the next essential criteria which is what I call…

“The Catalyst”

Stage #3: What’s the Catalyst for the Move?

The catalyst is like firing the ignition engines on an Atlas rocket. It’s the discernible event I can point to which has the potential to create a definitive rally.

It could be the launch of a new product line or the buyout of a hot startup. The type of catalyst IS important…

What I don’t want is just a short-term blip on the radar. I don’t want a fad that will quickly fade to black. What I want is something that shakes up the market a bit, introducing something that could be a true trend, a sea change for the market.

Looking back, these types of catalyst events are obvious.

For instance Hauser, a tiny little pharmaceutical company I followed early in my career, gets a new contract for an explosive new drug, Taxol. Bristol Myers snapped them up quickly…

But I can’t rely on hindsight. To successfully identify game-changing catalysts, I always pay attention to what each company is doing RIGHT NOW.

This is where my research shines. “A desk job” I do not have.

I’m engaged in active information gathering, doing things others (except for major hedge funds) refuse to do. Things like…

  • Speaking face to face with management teams…
  • Taking road trips, talking to suppliers for clues into demand…
  • Intense crunching of the numbers to determine the effect of new pricing strategies on long term margins…
  • If need be, I’ll find a way to count cars in retail parking lots with satellite imagery…

Nothing is out of bounds for me, in my quest to know the facts of the matter.

Satellite images like this are particularly helpful when analyzing traffic trends in major retail outlets. Analysis like this is what I’m accustomed to as a seasoned hedge-fund analyst.

Satellite images like this are particularly helpful when analyzing traffic trends in major retail outlets. Analysis like this is what I’m accustomed to as a seasoned hedge-fund analyst.

Stated differently, I do NOT rely on others’ analysis.

And it’s that kind of persistent research that yields the true catalyst for a major stock move.

Now, if the stock passes these first critical steps with flying colors, if all systems are go at this point, I do a double check…

Stage #4: Fundamental Analysis

Next, I dive deep into the financial statements. P&Ls, cashflow statements, revenue forecasts, balance sheets, etc.

What am I looking for?

I want to find already apparent signs of subtle but noticeable progress, such as improvements in margins, promising revenue gains or a strong balance sheet.

Not only that, I go the extra mile, digging into SEC filings, Patent Office filings, and those dense 1,000+ page regulatory documents. 

I realized early on that success in this business doesn’t come from being differentit comes from being superior.

Stage #5: I construct our own internal financial models and forecasts

Lastly, rather than rely on biased and uninformed sources, I do my own final analysis every time. I construct complex financial models and forecasts to confirm the information I’ve gathered to date.

I think of this stage is the equivalent of stress testing at NASA. It takes them months of refining to make sure even the smallest, seemingly insignificant, details are nailed down.

I do something very similar.

I look at every conceivable scenario that could play out, making CERTAIN we’re on to a sure-fire winner.

For example, if demand for a product rises or falls 10%, I’ve thought about it and considered it in our models.

If, and only if, a stock passes this final stage, I ring the bell and start letting my inner circle of investors know what’s happening.

If you’d like get access to 3 stocks that just passed every stage of this process with flying colors, click here right now


You might also enjoy…

 

Forget Buy and Hold. Here’s how to retire faster…

I’m not a fan of “buy and hold.” Gurus like to tell you that patience is the key, but I call horse puckey.

We’ve discovered an investing technique that consistently pays out easy-to-repeat profits.

One that’s proven to beat the market 2,082% in head-to-head testing.

And one that’s generated over 488 winners since 2011.

This method is so powerful, in fact, some of the investors we’ve let use it reported back to us saying they’ve made $71,425… $82,371… and even as much as $151,000 in a single year thanks to this “trick.”

That’s how powerful this investing technique is!

What what exactly is this mysterious method? I’ve put all the details together here.

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