Here’s a new way of locking in gains with PowerRatings

PowerRatings
questions we receive is about exits. So in today’s article we’re going to cover an
Exit Technique taught by Steve Primo, TradingMarkets Director of Education.
Steve teaches advanced

PowerRatings
classes every weekday (click
here for more info).

To recap:
From 1995-2005, stocks rated 7 have outperformed the S&P 500 by a better than
4-1 margin over a five-day period. Stocks rated 8 have outperformed the S&P 500
by a better than 8-1 margin; stocks rated 9 have outperformed the S&P 500 by a
13-1 margin, and those stocks that have achieved a 10

PowerRating have
outperformed the S&P 500 by a 16.9-1 margin. On the other hand, stocks rated 1, 2 and 3 have
underperformed the S&P 500 over a five-day period.

One popular Exit Technique takes advantage of

PowerRatings
changes. When a stock’s

In the chart above
(
PMTI |
Quote |
Chart |
News |
PowerRating) had a high

PowerRating
on 01/03/06. PMTI triggered an entry three days later and subsequently moved
sharply higher. By 01/12/06 PMTI had a

PowerRating
of 3, suggesting it will underperform the S&P 500 over the next five days. This
can be used as an exit signal — Buy mode to Sell mode.

The second example shows
(
FFIV |
Quote |
Chart |
News |
PowerRating). On 01/06/06 FFIV has a low

PowerRating
and triggered a short entry signal the next day. After a decline of more than
10% FFIV’s

PowerRating
moves up to 8. This change in

PowerRating
can be used as an exit signal — Sell mode to Buy mode.

Click here
to take a free trial of

PowerRatings

You can also
attend a free
class on how to use

PowerRatings
presented by Steve Primo, our Director of Education.

Ashton Dorkins

Editor-in-Chief