Here’s How OptionsPlay Gives Traders an EDGE

Active traders often measure performance based on initial profitability. However, a focus on quick profit alone is not enough to establish a successful strategy. A long-term buy-and-hold strategy in an index fund will likely also result in profits.

To justify the time, money, risk, and energy to learn and master active trading, you should be rewarded with outperformance relative to the market.

Otherwise, simply deploying your capital in an index fund would produce equal or similar returns with no time or energy consumed.

Our secret to outperforming the markets is an early detection model of trends. OptionsPlay gives traders an edge by offering ideas and research to identify trends long before the market with our proprietary counter-trend model.

How can you trade alongside a proven strategy to outperform the market?

In this post, we lay out our dynamic investment thesis at the core of the OptionsPlay Research team’s unique method to seek those very opportunities.

Our counter-trend investment strategy may fly in the face of what you’ve learned and practiced yourselves, but our track record proves the substantial success of our practice. There must be enough chance of profit to justify risk, time, and energy.

Rick Bensignor, OptionsPlay’s new Chief Market Strategist, has proven to help identify opportunities to play for trend changes at or near the actual turns and well before the bulk of investors are even aware that one is about to occur. 

Rick has been able to beat the SPX’s return in 4 out of the last 5 years — and by a total of 157.6% — using his finely honed trading strategies along with a very disciplined approach to risk management.

Trading strategies can generally be classified under two primary categories: trend following and counter-trend. Both are self-explanatory and come with respective benefits and trade-offs.

However, I want to explore why our research team’s investment thesis leans heavily towards identifying counter-trend opportunities to beat the market.

Trend-following strategies tend to be popular and easy to identify and deploy. However, the primary issue is that trade entries typically occur after it’s obvious to the Street which direction the trend is heading.

Thus, these strategies can produce profitable trades that are accompanied by two significant trade-offs:

1) entering after the trend has already been established, which means the “smart money” is already in, This makes beating the field an almost impossible task.

2) the risk/reward ratio worsens the later a trade is entered within a trend, making the risk of a deeper pullback more likely than if you had bought in when the stock had actually still appeared bearish to the average eye.

Counter-trend strategies, on the other hand, attempt to identify where a current trend is ending and a new one may begin by going sideways or in the opposite direction of where it was just trending.

Though many investors see this as a higher-risk trading strategy, with an expert’s guidance it can provide lower risk and dollar drawdown than conventional trend-following strategies.

In fact, this methodology far more aligns with the Wall Street mantra of “Buy low and sell high” than does “Buy high and hopefully sell higher”.

With the right tools and expertise, counter-trend trading provides the single best chance a money manager has to outperform their underlying benchmark index.

How do you reliably identify the end of a trend and the beginning of a new trend before the rest of the market?

Our research team, led by Rick Bensignor, leverages his 30+ years of trading experience on Wall Street with institutionally used models, and his unrivaled proficiency in directly applying Behavioral Finance Theory to his world-class market analysis.

At the core of his work are specific indicators that help him identify trend exhaustion on or at a trend’s actual turning point, not 15 to 20 percent later when the rest of the Street finally realizes that the trend has probably changed.

At the exact moment when a bearish trend is exhausted, and the last seller has sold, Rick provides the precise time to buy a security with much higher odds to then beat the market going forward. Conversely, when a bullish trend has exhausted the last buyers, he provides the exact time to take profits at the perceived market top and may even choose to establish a new short position in that name.

Start Trading With OptionsPlay Now

To learn how to use these effective counter-trend opportunities for yourself, join our community of traders and follow our OptionsPlay Research team’s trading portfolio with a free 30-day full-featured trial.

Read Rick’s weekly Technical Macro Research report on Monday mornings to start your week with the big picture macro-outlook.

Then join a live call with him Monday mornings before the open as he elaborates on his findings so that you are prepared with the essential market info you need across the equity, bond, and commodity markets.

Most importantly, subscribe to get to trade alongside our short term swing and macro signals with our DailyPlay published each morning at 9AM ET.

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Tony Zhang