Follow the Signs and Make Millions from a New Bull Market – Part 2 of 2
By Stephen Sutherland, author of Liquid Millionaire.Posted in the Category of Investing, Stock Market, Investment Fund, Wealth Building on 8th August, 2009.
Tags: investment opportunity, liquid millionaire, make millions, nasdaq composite, new bull market, smart investors.
How Evidence of a New Bull Market Could Help You Make Millions
As you are aware, in my book; Liquid Millionaire, I highlight an investment opportunity of a lifetime. To remind you, because the market has not made any price progress for over 10 years, it’s probably due a move.
To be able to profit from this opportunity it is good to know whether the market is healthy or unhealthy and, if it is healthy, what sectors the smart investors are investing in - so that you can do the same.
In Part 1 of this series I showed you a twelve month chart of the Nasdaq Composite and how it has made a remarkable gain of 58% in just 21 weeks. Today, I would like to share with you how my own portfolio is showing similar clues that the new bull market may have already begun and how you could personally benefit from this exciting development.
Portfolio vs. Market Performance
Portfolio performance versus the market performance is a great indicator of how healthy the market really is.
And with that in mind, my ISA portfolio found a bottom on Tuesday 28th October 2008 and not 9th March 2009, which, as I detailed in my last blog, is when the market found a new low.
This point is very important to understand. It means that because the investment funds that I own hold the market’s leading stocks (because by using my unique market screening tool HIRE CAR I always get my money into where the big money is flowing), when my account ‘‘bottom outs’’ before the market, it sends a very positive signal - a big clue if you will - that the market is much stronger under the surface than many would have you believe.
My account bottoms out earlier than the market because when you are holding the market’s best stocks (through investing in the best of the best funds), these stocks lead the market higher and eventually the rest of the market catches on.
And so because my portfolio was ‘‘beating the market’’ and doing so well, it was no surprise that eventually the general market had to play catch up and rally as strongly as it did from March to July.
To give you an example of how much my portfolio has beaten the market, over a recent 9 month period (28th Oct 2008 to 28th Aug 2009) I made a tax-free gain of 66.3%. That’s not bad when compared to the FTSE 100’s pretty lame 16.8%. And as I said before, whenever my portfolio beats the market by so much, it means that there is serious underlying strength in the market.
So where do we go from here?
The good news is that when you look at a weekly chart of the Nasdaq Composite, you can see that it recently broke out of a cup-with handle base pattern (Point D). If the Nasdaq can remain above its pivot point (Point E), it would send even more positive vibes to say that all is well.
I’d also like to see the Nasdaq remain above its 50 day moving average (Point F).
And so to summarise, the market is very strong right now and since early March, it has generated a lot of momentum.
If you would like to find out more about how you can take full advantage of the once in a life time opportunity that the stock market is currently offering, please contact a member of my team for a chat. You have my word that there will be no sales, no jargon, just the facts.
Your friend,
Stephen Sutherland
The UK’s Leading Authority in ISA Trend Investing and Author of Liquid Millionaire
Please Note: As always, let me remind you that I am not a financial adviser and therefore not authorised to give advice on what investments to buy or sell.
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