You may have noticed The Daily Reckoning has run several keen insights from Barry Ritholtz over the past few weeks, including his essay, "Downsizing America."
Barry's a regular on CNBC's Squawk Box, Kudlow & Company, Power Lunch, and Fast Money; as well as on Bloomberg, CNN, Fox, and PBS.
His blog, The Big Picture, has been read by over 40 million readers. But, that's not why we're writing to you today...
In his soon to be released book, Bailout Nation: How Easy Money Corrupted Wall Street and Shook the World Economy, Barry, among other scandals, uncovers the dirty truth behind the AAA ratings that Wall Street's agencies continued to give toxic subprime assets - even after the credit crisis began.
In an effort to quash the truth, McGraw-Hill - the original publisher - dropped Barry's book contract. McGraw-Hill, as it turns out, also owns S&P... one of the companies Mr. Ritholtz takes aim at in the book.
Who knows what kind of back room panic his insights caused up the ladder. Fact is, you'd be hard pressed to find in recent history a more blatant attempt to strong arm a writer into silence.
As soon as I heard what was going on, I knew Barry was our guy... this is information you can't afford to be without! I ran it up our own flagpole here at The Daily Reckoning and before you know it...we were in full on talks with Mr. Ritholtz.
Since our initial discussions, we've gotten to know Barry pretty well. He's a true "numbers" guy. His predictions have been amazingly accurate over the past few years. It's no surprise to me why he's become one of the most in-demand investors of our time.
Fortunately, Barry has developed what could be one of the most effective tools ever for an individual investor who feels mislead by all the noise coming out of the media during this most challenging market.
And that's the real reason we're writing today. As a result of our interest in his book and his story, we can now offer you an incredible side benefit: Barry's insight on the market at an extremely advantageous price.
In the report below, he'll show you all of his secrets to investment success and help you avoid the pitfalls of investing in this post- bubble environment. Hope you enjoy.
This is one tough market."
I hear that in the office every day - from individual investors, professional traders and money managers alike.
These markets are brutal, and the competition has been relentless.
For the individual investor, it's important to understand exactly who makes up your competition.
Your competition is everyone else who's buying or selling top stocks. They, too, are looking for ways to produce positive returns.
But it's not just people like you who make up your competition...
Consider what Charles Ellis, who helps oversee the $15-billion endowment fund at Yale University, said:
"Watch a pro football game, and it's obvious the guys on the field are far faster, stronger and more willing to bear and inflict pain than you are. Surely you would say, 'I don't want to play against those guys!'
Well, 90% of stock market volume is done by institutions, and half of that is done by the world's 50 largest investment firms, deeply committed, vastly well prepared - the smartest sons of bitches in the world working their tails off all day long. You know what? I don't want to play against those guys either."
The "institutions" Ellis refers to are mutual funds, hedge funds, and program traders - and all of their professional staff, mathematicians, and researchers assisting them.
These pros deploy every possible tool they can to give them whatever edge they can get. And when even they are having a hard time, that means it's a very tough trading environment.
Despite the stiff competition, many folks step onto the playing field with the pros.
But they're not prepared. Not even close.
That's why we developed a powerful tool that places you on an even footing with the pros.
Here's One Simple Way to Beat the Pros at Their Own Game...
You see, it's an arms race between you and the big boys who have developed very powerful trading tools.
If you want to be a successful trader, you need to be as efficient and productive as possible. Often times, the guy on the other side of your trade is one of those pros. And you better watch out. Because...
I've seen the largest trading floors in the world. The tech the pros have at their disposal, the data they can call up; it's impressive. The pros have spent tens of millions. And they spend years learning their systems in front of a screen.
That's what you're up against. That's your competition
In short - we've found a way to prepare you for any outcome the market can spit out.
It's a software tool called FusionIQ.
It marries fundamental and technical analysis to help you trade better in any market.
FusionIQ helps manage risk. It can also help you find new trading ideas.
This is what Barron's had to say about FusionIQ:
"FUSIONIQ'S MODELS blend fundamental and technical metrics to determine the strength of some 8,000 publicly traded equities. They identify the most tradable issues and sectors with the lowest component of risk. FusionIQ also finds issues with unusual short-term strength or weakness, issuing Buy and Sell signals accordingly. In general, FusionIQ recommends subscribers hold a rolling portfolio of 15 to 20 issues for the intermediate term."
FusionIQ has you covered. Here's how...
FusionIQ can get you thinking about selling, tightening up stop losses, or hedging positions long before they hit bottom.
If you are going to manage your own portfolio, then you have to learn to manage your risk. Finally, for the regular investor, realize that you are trading against thousands of people and funds that have tools like this. Putting a system like FusionIQ on your side is the least you can do.
Here are the details...
Your Independent Path to Protection AND Profits
I've also been profiled in the Wall Street Journal's "Quite Contrary" column. Or, perhaps you have seen me on TV, where I've been appeared on numerous stations, including CNBC, Bloomberg, Fox, and PBS.
Working with my partner, we have been trading these markets for a collective 50 years, we looked at all the ways we can apply technology to tilt odds in our favor.
All the big proprietary trading desks - banks like Goldman Sachs, huge hedge funds like Pequot and SAC - spend tens of millions of dollars to assist their decision making.
We decided some time ago that if we wanted to compete on this playing field, we needed something to even up the odds.
During the tech wreck and dot com collapse of 2000-03, my partner Kevin Lane came up with an idea. What if we could create a database to track various indicators for hot stocks and markets?
The idea was to pull only the most important stock factors into one location. Not to merely screen the market, but to actually rank all of the most popular stocks from worst to best, based on both earnings and ownership metrics, as well as the charts.
This way, we would have a timely method to measure important technical AND fundamental metrics.
After years of brainstorming, we selected and, more importantly, eliminated a variety of stock metrics. Lots of back-testing went into the final product.
We found ourselves using the tool more and more. Kevin had famously recommended shorting both Enron and Tyco during the dot com crash, and the tool had a lot to do with that. (Business Week even wrote an article about it called, "Analysts Who Get It".)
With the goal of making smarter, more informed trading decisions, we sought ways to create better returns with less risk.
By combining good fundamentals and strong technical momentum characteristics, we found we could identify not only what to buy or sell, but when.
That's how FusionIQ was born.
In 2006, we formed Fusion Analytics Investment Partners LLC. We developed our algorithms and beta tested everything throughout 2007. The software was launched at the current site in late 2007.
How Does FusionIQ Work?
The software uses our unique combination of fundamental and technical indicators to rank over 8,000 top stocks, ETFs, and closed-end funds. The rankings range from 0 (worst) to 100 (best).
These provide insight into stocks that are more likely to outperform, as well as identifying what stocks price should be avoided. From there, we apply our proprietary algorithms, generating BUY, SELL, and NEUTRAL signals. For more aggressive traders, the system identifies breakouts and breakdowns, short squeezes, and other trading opportunities.
For long-term investors, we developed a way to help manage risk in your holdings by creating a Portfolio Watchlist. This allows you to enter all of your current holdings, which are automatically ranked and monitored. You can easily keep tabs on your portfolio holdings as their FusionIQ rankings change.
Stocks ranked 70 and higher are candidates to keep, while lower-rated best stocks should be reviewed for removal from a portfolio. For investors who do not like the buy & hold mantra, you can trim your portfolio using our BUY, SELL, and NEUTRAL signals. These signals are generated when specific conditions are met. It is both objective and neutral.
In 2008, the sell signals helped us avoid a lot of trouble. We recommended selling or shorting Bear Stearns when it was over $100. We very publicly said the same about AIG in early 2008 (and Bloomberg wrote a story about it called, "Fusion IQ's Ritholtz Expects More Writedowns at AIG").
We also told readers to sell Fannie Mae (over $40) and Lehman Brothers (over $30). While we caught some grief for these calls early on from fans of the companies, in the end our clients and investors thanked us. All of these calls were made using the FusionIQ system. And I'm sure you know how they ended up playing out...
Here are some recent signals and rankings from the FusionIQ software...
General Motors (GM)
Back in November 2008, we looked again at General Motors as it was under pressure with liquidity concerns. The only hope seemed to be a big-time government bailout, or perhaps consolidation with another automobile or truck manufacturer.
Using FusionIQ screens, however, kept us ahead of the curve.
As seen below on this yearly GM chart, our unbiased screening system has had GM ranked extremely low (an 18 Master, 10 Technical out of 100 as of that November date) with multiple sell Triggers.
These sell alerts would have woken an investor up that something was wrong with the underlying firm. That is something that will not show in the earnings or conference calls until it's too late.
Look at this GM chart on November 10th, 2008. We called it... and protected your investment!
Even more shocking than the GM chart is the AIG yearly chart. In addition to our ranking and timing indicators (see all the sells), Fusion Analytics published a sell on AIG for our institutional clients on 2/13/2008 at $46.14.
The first government bailout of AIG was not good enough, so they had to try, try again. In November, the US government announced that they would sweeten the pot in another attempt to save the firm.
This AIG chart shows the same story...we're safeguarding your assets!
It's not only the sells - we find many buys this way too.
FusionIQ Identifies the Time to Sell - AND The Time to BUY.
Recently Netflix Corp. (NFLX) caught our eye. As the chart below shows, NFLX had a new FusionIQ timing BUY signal in mid-December.
Since then, despite the market's overall softness, there was technical strength in the stocks market. As seen below, NFLX shot up almost 30% since that buy signal.
This Netflix (NFLX) chart shows how you have the chance to profit.
Active traders can use FusionIQ's short-term trading signals. These are mostly technically based, as opposed to the Fusion of technical and fundamental data used to arrive at our scoring system.
These trading signals can be used as a wakeup call that something may be changing and your analysts need to dig deeper.
Also, many clients use these signals as a way to trade around their core holdings (adding alpha).
These charts that follow ... if you were long these names in your portfolio, do you think these heads-ups might have helped? These charts are just a snapshot of what FusionIQ can do for you...
This ALCOA chart shows an early warning of danger lurking ahead!
This Mosaic chart shows you how you can avoid catastrophic losses!
As you can see, with FusionIQ on your side, you would've had the right information at your fingertips months ahead of time.
There's no way you would've experienced the huge down swings some investors saw on Alcoa and Mosaic.
You would've saved money. Saved time. That's why you need FusionIQ...and that's why you can:
Try FusionIQ Today - At 20% Off the Normal Price
Buys. Sells. FusionIQ can offer you both.
That gives you the same power as your pro trader competition.
Years in development - and years to test. Now it's ready.
FusionIQ is ready to help you beat the competition - and make healthy, competitive returns in this difficult market.
Plus, if you'd like to give FusionIQ a risk-free try, you can get it right now at a steep discount.
The special price for Daily Reckoning readers is $39.95 a month (regular price is $49.95 /month), and you will get the full FusionIQ system as part of this offer.
That's a 20% discount. Just to give FusionIQ a try.
It could be the edge you need to beat the competition - and turn 2009 into one of your best years ever.
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