The “smart money” institutional investors indeed spent the week buying stocks at discounted (“bargain”) prices, buying the same stocks that small retail investors had been selling the prior 3 weeks for losses, proving themselves the amateurs that they are. 

Many stocks – including ours – were modest risers last week as institutions took advantage of over-sold market conditions. 

Amateur investors are those most likely to act on emotions, and do what later is often proven to be the “wrong thing” at the “wrong time”. They are very beneficial to the marketplace, however, as they serve as the patsy for the “smart money” institutions by taking the other side of the trade – selling when the institutions want to “buy low” and buying when the institutions want to “sell high”. 

All this occurred on a short week in which economic news was uneventful but nevertheless skewing negative, so the institutions must privately have their reasons to have a positive long-term outlook. 

As always, we strive via analytics to identify and act on the trading behavior of these successful institutions, so we profit as they do and avoid being among the amateurs they take advantage of. 

On this somber U.S. anniversary, let’s affirm our commitment to NEVER FORGET. 

Get your first month FREE when you subscribe

A full month of actionable insights on which stocks to invest.