Marc Chaikin Point of View for Market

Monitoring ETF Positions with a Power Gauge

Investors have long been confused by the subject of selling. The security’s investing advantages are important. Individual time horizons and risk tolerances also play a role. We do not normally recommend utilizing a rank shift from Green to Yellow as an automatic sell indication due to the number of circumstances that might impact a decision to sell. But now and again, we find ourselves in unusual circumstances.

Marc Chaikin claims to be able to forecast how stocks will perform. “Essentially, Tom, we’ve discovered a mechanism to see which stocks might soon rocket off by 100% to 500% or more… by projecting the future stock ratings of over 4,000 different firms,” he explains.

He believes that the activities of institutional investors are the most crucial indicator of whether a company will move up or down because when they move on a stock, they shift the needle.

Nothing moves a stock more quickly up or down than the activities of institutional investors.

When a bank invests hundreds of millions of dollars in stock, it can skyrocket and climb hundreds or even thousands of percent… “It’s all because of the massive amount of institutional money that’s coming in.”

As a result, he believes that the best thing for an individual investor to do is to try to mimic what institutional investors are doing in the market. And here is when his indication comes into play. “…what I’ve learned over half a century on Wall Street is that when a bank’s research side provides a bullish rating, the investment side will start purchasing it hand over fist,” he adds.

And this is where I have a significant and, dare I say, UNFAIR edge.

One can read more on Chaikin’s predictionhere for more suggestions.Marc refers to his technique as The Power Gauge and claims that it employs this indication in conjunction with 20 other variables that the smart money on Wall Street considers when determining a stock rating. His algorithm then assigns a stock a “Bullish,” “Neutral,” or “Bearish” rating. He uses the firm Digital Turbine as an example (APPS).

He is referring to the following 20 factors:

  • The debt-to-equity ratio
  • Price-to-Book Value (P/BV) Ratio
  • Return on Investment
  • The Price-to-Sales Ratio
  • Analysis of Free Cash Flow
  • Earnings Increase
  • Earnings Surge
  • Earnings Development
  • Price/Earnings Ratio Projected
  • Earnings Stability
  • Individual Stock Strength compared. the S&P 500
  • Money Flow Chaikin
  • Chaikin Style
  • Price Change Rate of Trend
  • The Volume Trend
  • Revisions to Earnings Estimates
  • Short Term Interest
  • Insider Trading
  • Opinions of Analysts
  • Industry Group’s Strength compared the Market

Financials (numbers 1-5 on the list), Earnings (6-10 on the list), Technical (11-15 on the list), and Experts are the four categories for the 20 factors (16-20). He concentrates on stocks that are not widely recognized because he feels they have the most potential. He has a list of equities that he believes will do well once the country fully recovers from the pandemic lockdown and transitions to a new way of doing business.