Part 2: Only Trade the Top 2% of Stocks

Complete the actions to take below. Follow along with my video by clicking “Read Cash Course: Part 2”.

Action to Take

Familiarize yourself with the best stocks to trade by checking out the Options Penny Pilot list. Then, use my three-step process to narrow down your options.

In Part 1 of my Cash Course, I revealed the secret weapon you need to make some serious cash in any market environment: options.   

And now, I’m going to  I’m going to share another tightly-guarded piece of intel the suits on Wall Street don’t want you to know.

It’s something they’ve been hiding because it levels the playing field and gives you a real shot at making some serious cash…

The kind of cash that can pay off all your debts, send your kid to a nice four-year college, or cover that dream vacation you’ve been wanting to go on.

Here it is…

Most stocks and exchange traded funds (ETFs) are trash.

That’s right… pure junk.

Now I realize that this probably goes against everything you’ve ever been told. In fact, I’m willing to bet that at some point in your life, you’ve probably been told to dump your cash into a bunch of different stocks, mutual funds, and even annuities to make the most of your portfolio.

But here’s the problem…

Right now, there’s over 4,000 public companies listed on U.S. exchanges and over 25,000 different stocks to trade worldwide. And the big banks and brokerage firms want you to gamble your money on all of them. The worst part is… they don’t actually care which ones you buy and sell, and they definitely aren’t trying to help you minimize your costs (and broker fees) and maximize your profits.

Whether you’re buying stocks, mutual funds, or even annuities – the Wall Streeters want you to spend your hard-earned cash on investments that’ll take 10, 15, or even 25 years to give you a mere 10%. And that’s 10% in a good year – if you’re lucky. Most of the time, the returns are far less than that.

It doesn’t matter if your trade is a winner or a loser, your broker gets paid in fees and commissions. Even if your investments actually make you some money, the big investment banks are taking the thousands of dollars you’ve worked your entire life to save and are putting it to work on risky speculative investments to enrich themselves.

That’s how they rig the game against you.

They’re not looking out for your financial interests or your financial future. And that’s exactly why it’s time for you to take back control.

But with 25,000 stocks… where do you begin?

It starts with getting rid of the junk – you know, the 98% of stocks and ETFs out there that simply aren’t worth a single penny. Even that latest initial public offering (IPO) that’s getting everyone’s attention, that hot stock tip from your friend, and that company you’ve spent hours researching and are convinced is a sure bet most likely belong in the junk pile.

So today, I’m going to show you how to filter out the only stocks worth trading.

Now let’s get started…

How to Find the Top 10 “Movers” to Trade

With so many “junk” stocks and ETFs out there, the last thing I’d ever recommend is trying to sort through all the optionable stocks (stocks that offer options) one by one – that will eventually drive you crazy. Fortunately, I’ve developed a great method to whittle it down to the 10 best stocks at any given time.

Now I use my proprietary tools to run a scan that searches for what I call my “Top Movers.” First, I look for only the stocks with options that trade in penny increments, typically within a $0.05 bid/ask spread. That narrows it down to around 250 stocks in total.

You can find that list of stocks without your own software by looking at the Options Penny Pilot list on the Miami International Securities Exchange (MIAX) website and clicking on the “CSV” file under “Classes in Options Penny Pilot Program on the MIAX Emerald Exchange.”

But even though you know exactly where to go, sifting through 250 stock charts to look for the most volatile ones is still a lot of work.

So here’s three parameters to cut that number down even further:

  1. Look for stocks over $100 per share
  2. Look for stocks that move an average of 1% a day between the high and low
  3. Look for stocks that correlate to the market

Here is a snapshot of the stocks that meet the criteria above and have been on the move over the previous seven days. Keep in mind that this list changes daily, so these results could be different from what you’re looking at when you open it:

You’ll often see ETFs in a few of the top spots, but we’ve got a solid collection of stocks here, including Apple Inc. (NASDAQ: AAPL), AbbVie Inc. (NYSE: ABBV),  and Inc. (NASDAQ: AMZN).

Now the two most important numbers to use in combination with this list are the stock’s percentage move over the last seven days and how well the stock correlates to the SPDR S&P 500 (NYSE: SPY). With those two numbers, you can figure out how well a stock moves and if it’s moving with or against the markets.

Once you have this list of stocks, you can run any number of screens and filters to assess which of these “Top Movers” would make the best option play.

And in Part 3, I’ll debunk another one of the biggest financial myths out there today: you can’t predict a stock’s next move.

You can – and I’m going to show you exactly how.

Click the green button at the bottom of this page to continue to Part 3. 

Q. Of the 25,000 stocks in the world today, which ones should you trade?

A. The top 10%
B. The top 2%
C. The top 5%

Q. Which two numbers do you need to figure out how well a stock moves?

A. Percentage move & and how well it correlates to the S&P 500
B. Previous day’s closing price & trading volume
C. Volume & open interest

Q. Where can you find a list of the “Top Movers” to set up the best trade?

A. Money Morning
B. Yahoo! Finance
C. The MIAX Options Penny Pilot list

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