Bear markets are never fun to sit through. However, market leading stocks still exist – even if few.
Our stocks beat the market this year, by a wide margin. Here’s our Big Money review for 2022.
As stocks climb to a 2-month high, those gains don’t fully reflect the overall weakness in the market. As I write, the S&P 500 is down 16% while the NASDAQ 100 (QQQ ETF) is off 29%. Yes, it’s been a long pullback.
Even with the market slump, there’ve been plenty of leading stocks pressing to new heights. And MAPsignals uncovers many of those names -through our Big Money lens.
Today, I’ll recap our 2022 stock performance. And I’ll highlight 3 names still under accumulation.
I like to say there’s always opportunity… that statement is still true even in the bear market of 2022.
Big Money Review for 2022
The MAPsignals process starts by looking at unusual volumes in thousands of stocks. Basically, we’re trend followers of volume. When stocks are accumulated, they rise. When they’re sold, they fall.
It’s supply and demand 101.
Here’s a look at 2022’s overall Big Money flows. Each day our system tallies up all buys and sells, identifying the near-term trend. Typically, buys outnumber sells in an average year, but that hasn’t been the case YTD.
We’ve had 5 major selloffs in this year, highlighted below in yellow. Through the lens of data, selloffs pick up steam then finally climax, eventually setting up wicked relief rallies.
Have a look:
Fighting the overall trend is never easy. Finding winning stocks in this environment isn’t a cake walk. But stay with me.
On top of tracking big volumes, we take it a step further by overlaying a scoring system on each stock. Our MAP Score is made up of a technical and fundamental score – similar to a GPA that we all got in grade-school. The higher the rank, the better.
Each week, we profile 1 stock in our MAP View report released on Sunday. Generally, it’s a company with a high score, pulled from our weekly Top 20 list.
Here’s how each of those stocks performed on average YTD. To calculate the performance, we assume the entry is the day the stock was profiled, then hypothetically held until the close of 11/22/2022.
Again, our process is to follow the money flows on the highest quality stocks. That’s where the winners are found.
Get this, the average performance for all 44 stocks came out to +4%, which may not sound exiting. Keep in mind this is vs a -2.9% fall for the S&P 500. This is to give an apples-to-apples comparison:
In one of the worst bear markets in recent history, outperforming the market by +6.9% with 44 names, we’ll take it!
Additionally, each week we put out our Top 20 list of stocks on Tuesday morning. We profile 2 equities from that pool. Using the same methodology as above, here’s the average performance hypothetically held until 11/22/2022.
The outperformance was much stronger and on double the names. 88 stocks averaged a gain of +6% vs a -2.6% fall for the S&P 500:
At +8.6% vs the market, that’s quite an accomplishment. It’s a testament to the power of positioning and volume trends.
Even with thin leadership, staying alert to unusual volumes can enhance your investing. It’s something I saw firsthand when trading at a bank years ago. Demand for shares pushes prices higher week after week, month after month.
Now, let’s shift focus to single stocks. Here are 3 well-known names from 2022 that bucked the market’s trend. They were highlighted months ago. Notice that the big volume signal has been quite consistent.
Up first is Hess Corporation (HES). This oil & gas producer began ranking high back in January. The Energy sector quickly shot to the top of our ranks, with Hess highly scored.
Each of the blue bars are the times HES was on our Top 20 list. It’s been under heavy accumulation all year:
Up next is Black Stone Minerals LP (BSM). The firm engages in the exploration of oil and natural gas minerals. High commodity prices have kept the shares elevated all year.
Those blue bars tell you it’s one of the best names out there:
Finally, let’s head over to the Technology sector. Most would scoff at owning tech stocks. However, Super Micro Computer (SMCI) has been making a splash in our data. The server and storage firm, is an under-the-radar leader:
These few examples highlight that even in the toughest markets, paying attention to trading flows can give you an edge.
Let’s wrap up.
Here’s the bottom line: This year has been one of the toughest markets to navigate. That’s the bad news.
The good news is our Big Money review for 2022 shows our process can pick up on the next leading stocks. Both our MAP View and Top 20 names easily outperformed the market.
I’ll be the first to say it wasn’t perfect, but it’s a record we’re proud of. And with signs pointing to a yearend rally, we’re preparing for more upside soon.
Don’t fight the Big Money!
Here’s to wishing you and your family a happy Thanksgiving holiday! We are thankful for all your support.
Lastly, start off 2023 with a MAPsignals subscription for access to our software, charts, and more. Let data enhance your trading.