February 14, 2020

Trading Strategies to Profit in All Market Conditions

Midas Letter
Midas Letter
Trading Strategies to Profit in All Market Conditions

Wealthpress Head Trader Roger Scott joins Midas Letter to discuss the deluge of testimonials he’s been receiving from his subscribers speaking to how he has helped them profit big in today’s market. Roger provides services related to swing trading, day trading, and options trading for all levels of active investors and traders. The Wealthpress Head Trader outlines where most of his profits were made this quarter and his roadmap strategy – with entry/exit levels, stop-loss recommendations, risk protection and trading alerts. Watch the full interview to see how his traders have outperformed the market consistently.


James West: Roger Scott joins me now. He’s the publisher of Roger’s Radar with Wealth Press. Roger, welcome.

Roger Scott: Thank you for having me. I really appreciate it, James.

James West: Roger, what is the essence of your service at Roger’s Radar?

Roger Scott: Well, we provide a lot of services that are related to swing trading, day trading, and options trading. They’re all for active investors and active traders.

James West: Okay, and what kind of stocks do you focus on?

Roger Scott: That’s a great question. Several of the services – what I try to do is this: when I used to manage institutional money, I created several diversified systems. So, in other words, ill have a system that focuses on large-cap stocks. I’ll have a system that focuses on small-cap stocks. I’ll have a system that focuses on ETFs and assets that are un-correlated to the market.

So every system, when you add them all together, you get amazing diversification and long term leveling in terms of volatility, which is really important. So when you ask me that question, we’ve got a system that literally focuses on every segment of the market.

James West: I see, and the main reason for my interest was the relative deluge of testimonials you’ve been receiving from your subscribers. Describe what the nature of these testimonials is, and why are all these subscribers writing in?

Roger Scott: Well, it’s a great question. To be honest with you, and I hate to toot my own horn, but half or more than half, I think five out of eight of our systems, are literally making all-time highs right now. The markets have really good to us, our trading has been on par, and I’ve been doing a lot of morning videos. And in these videos, what I do is, I ask for, I say, hey, if you like this, if you’re getting some value out of this, send me a letter, send me feedback.

And people have just been sending us the nicest emails, the nicest letters. You know, ‘I doubled my account, I made a lot of money, I made 400 percent return, I made 300 percent…’ It’s been fantastic, really fantastic, especially how we’re starting 2020 on the right track.

James West: Wow, that’s remarkable! Congratulations on that.

Roger Scott: Thank you.

James West: How did you get into – you said you were an institutional trader before, is that how you started the whole service?

Roger Scott: No, it’s a long story, but I’ll give you the five-minute puzzle. I originally got into the business by being a broker. I went to law school, I never practiced law. Started out as a broker, met some amazing people: Richard Dennis’ pupil, the current Senior Financial Advisor to the White House. We started some funds together over the last 20 years. The funds made really good money over the years, and we just took it further and further.

And what I did was, I specialize in system development and testing, which are objective algorithms. And in the last several years, the systems, the software to test these systems have gotten better and better, and as a result, we’re able to create systems that are just a hair shy of artificial intelligence, at this point. They’re scary accurate, and the results are amazing, James.

James West: Well, that’s fantastic, Roger. So, where have most of the gains been coming from in the last quarter?

Roger Scott: Large caps. Tech and large caps. They’ve been just going nuts. We’ve had this thing with China and the TerraForm, and as you know, we’re now incomplete with the first part of the agreement is done, the Phase I is done. And what that means is, stocks are now not too concerned about China anymore. They’re making new highs again.

So, earnings have been better than expected; volatility has been near all-time lows. Interest rates are really low, and it’s been a great time for large caps. NASDAQ stocks, we currently have, get this: We currently have – this hasn’t happened in five years, James – we have 85 percent of all the stocks in the NASDAQ 100, which means 85 stocks out of 100, are trading above the 200-day and the 50-day moving average.

That’s the first time that’s happened in five years, and that’s telling us the momentum, the bullish sentiment that’s driving this market, is just off the charts right now.

James West: Yeah, that’s incredible. So this money, where is it all coming from?

Roger Scott: Well, that’s another great question. You see, the Fed right now – again, I don’t know how much of your readers know this, but the Fed has been putting money back into the market. They’ve been buying bonds, there’s a pledge to put $68 billion worth of bonds back into the stock market. The Fed wants to keep interest rates low, and a lot of this is creating liquidity, and it’s causing funds, institutional money, to just jump on the market. 

You may or may not know, but since between 2008 and 2014, when this quantitative easing was in big effect, the global economy went from 34 – the global stock market went from $34 trillion to $68 trillion, and it’s been at that level since 2014. Now, for the first time since 2014, the Fed is putting money back into the bonds. They’re buying bonds to keep interest rates low, because they were very scared that this China trade war was going to go south. They were afraid that interest rates were going to go higher, they were afraid that earnings were not as good as they are right now.

So all of these things, all of these factors, is creating liquidity in the market. Institutional money is flowing back into the market, and it’s causing upside.

James West: Sure. So, what is there out there that could put an end to this good time roll?

Roger Scott: That’s a very good question, James. First of all, every time a percentage of stocks in the S&P 500 or the NASDAQ gets above 86 percent momentum in terms of momentum levels, we tend to see a cool-off. 

Number two, I’m very concerned about this coronavirus. We really do not know the extent of it. Just the other day, China said it was under control; today, we’re hearing more news that they’re using different testing methods, and that they found out there’s 15,000 additional cases. Car factories in China just recently opened up again, and there’s question of whether they’ll remain open. So there’s a lot of factors involved right now. There’s a big wild card with this coronavirus, and also, historically, as we get closer to the elections, stocks have done okay.

So I’m not expecting a runaway bull market towards the end of the year, but I still believe first quarter and second quarter will be very bullish, if this China virus doesn’t eat the rest of the world up, so to speak.

James West: Sure. So I guess it’s fair to say, then, that uncertainty is a characteristic of election years, the closer to election you get?

Roger Scott: Yeah. As a matter of fact, statistically speaking, not every election – if you look at election years, and if you look at the predominant cycle, there’s a positive sentiment every time the same president gets re-elected; but there’s a big question mark when it doesn’t happen. And again, Trump is facing a lot of issues, to say the least. There’s a lot of talk. Democrats are gaining steam; there’s a question mark if he will be re-elected.

Although the polls do say he will, the stock market believes it 100 percent. He’s really good for the stock market, so…there’s a lot of wrinkles. There’s a lot of wrinkles. Will the Fed be able to keep rates this low for the next four years? It’s a question mark. The impact of coronavirus. Will this China-US trade war amount to something, or is it going to stall and the momentum will drop? There’s a lot of unforeseeability.

James West: Right. Okay, Roger, let me ask you this: forward-looking statements, obviously, is part of our safe harbour language, here. Had I invested $100,000 or $10,000, let’s say, with you, in January at the beginning of this year, how much would I be up, potentially?

Roger Scott: Potentially you would be up, depending on your risk tolerance, if you traded the underlying asset, you’d be up about 12 percent. If you traded the option, you’d be up about 140 percent.

James West: Wow. So you leave that optionality available to your subscribers? If they’re less risk-tolerant they can just stick to the underlying commodity; if they’ve got more risk tolerance, they can take out some of the options?

Roger Scott: I don’t think I’d be able to say it better myself, James. Here’s how we do it: every one of our strategies, every one of our systems, will give you the entry/exit and the stop loss, the risk protection, for the underlying asset and for the option itself. So we give you the signal for the stock or the ETF, and we give you one for the options. We do not discriminate.

We have some traders who have very large accounts. Hundreds of thousands of dollars, million dollars accounts; they don’t want the volatility. They’re just looking to outperform the market. Look, the stock market has given us 6 percent over the year over the last 20 years; that’s terrible.

James West: Right.

Roger Scott: So a lot of investors want to outperform the stock market. Six percent a year, if you can breathe, if you have a heartbeat, you should be able to outperform the 6 percent a year. But all jokes aside, the truth of the matter is, investors have two goals: lessen their volatility, increase diversification, and outperform the market. So we’re trying to help them achieve all three goals.

James West: Fantastic. Roger, I’ve actually subscribed to your free letter at this point; I’m going to subscribe to the paid version. I’m going to throw $10,000 at this and see where it takes me, and we’ll have a conversation a month or so later, if not sooner. I really appreciate your input today.

Roger Scott: Thank you. It was a pleasure speaking to you. We’d love to do this again. Loved your questions.

James West: You bet. Thanks.

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