Have You Heard of the “13W” Trading System?
“It took me 20 years, but I finally figured it out...”
It was a cool autumn Monday in September. I remember it well because I'd needed to wear a sweater.
It had also been my first day on the floor of the New York Futures Exchange (NYFE) in 1983.
I was a few weeks shy of my 21st birthday, and I'd never had a doubt that this was what I wanted to do.
I'd been reading books about Wall Street since I was 10 years old. At the time, I hadn't known how I would get there, but I'd known that I would.
My stomach was doing backflips the whole subway ride to Wall Street.
I took the elevator to the office of my clearinghouse.
In order to trade on the floor, you had to be signed up with a clearinghouse.
The clearinghouse guaranteed your trades with other traders. If you lost money and didn’t maintain a certain amount in your account, the clearinghouse would cut you off — no one would trade with you.
I'd learned all of this at a brief seminar that all first-time traders had been required to attend.
They'd basically told us, “Make sure you keep your losses small and let your profits ride. Good luck!” Not much in the way of instructions...
We were then given gray trading jackets with the clearinghouse's name was on the front upper right side. I also got my trading badge.
Each badge had a number and your alpha. The alpha was made up of any two to three letters. My alpha was MIZ. And from that day on, that's what everyone would call me.
The badge had to be prominently pinned on the upper left side of your jacket. Whenever you made a trade, you would jot down the badge of the other trader’s alpha on your trading ticket. And the other trader would do the same...
Cutting My Teeth in the Trading Pits
Every half hour, runners would come around to collect the trading tickets. They would then match up the trades that I'd made with other traders.
Our next stop was the trading floor. It was only 9 a.m. It was still early, and trading didn’t start on the NYSE until 10 a.m. back then.
I started to walk around the floor. Everyone seemed to know each other. I felt like a spouse at their partner’s high school reunion. I was so nervous that I almost pissed my pants.
At exactly 10 a.m., the bell rang and trading began.
There were huge monitors all around the trading pit. Prices of commodities, stocks, indexes, interest rates were all flashing while they changed.
I had no idea what to look at. My heart sank.
One of the older traders saw the look on my face and approached me. He said, “Don’t worry, everyone here has had a first day. Give it time — you’ll figure it out.” I must’ve looked pretty pathetic.
He'd seen me staring up at the monitors. Seeing how lost I was, he started to tell me what each monitor was. “This monitor shows bond trades. That one is commodities. The one right above us is stocks.”
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He told me that it would take about a month to learn all the symbols. By the end of the third week, I'd started to get the hang of it.
I started to see how the markets were connected. I learned what happened to interest rates when oil prices went lower and how every time IBM went up a quarter point, the stock index futures would move higher.
It took me about month to fully understand what I was seeing.
It would then take me the next 20 years to figure out what really mattered...
Beyond the Noise Is Where the Music Plays
Over the years, the biggest problem I’ve seen is that investors have too much information. Information overload is a killer — it’s like trying to take a sip from a fire hydrant.
I was never too shy to ask for advice and never thought that I knew everything. I was also very lucky: I surrounded myself with people who were much smarter than I was.
I learned that there are only a few variables that really matter.
Usually, there are no more than three or four. I can now look at a balance sheet and know in less than 10 seconds if a company is financially sound.
I can also look at the income statement and figure out the price I want to pay for the stock. It doesn’t take me too long to see if a $1 stock is trading at $0.50 or at $2.
In less than 30 seconds, I’m able to separate the stocks that look like they're about to soar from the dogs. Keep in mind, it didn’t happen overnight: It took me more than 20 years to figure all of this out.
That’s why I want to tell you about a little trading pattern in the stock market that’s worked like a charm for my readers.
I call it “13W.”
It stands for “every 13 weeks.”
Just as the sun rises and sets every day, there’s a mysterious three-step pattern that plays out in the stock market every 13 weeks. It happens like clockwork.
Here’s what happens: On a 13-week cycle, stocks that appear permanently down and out suddenly explode for massive profits.
In the coming days, I’ll show you how it works with incredible accuracy. I’ll show you how we’ve played “13W” with amazing results in specific stock trades.
It’s one of the reasons why, through my Charles Mizrahi’s Insider Alert advisory service, I’ve been able to produce raw returns of more than 3,691% over the past nine years.
All my best,
Founder, Park Avenue Digest
Charles cut his chops on the trading floor of the New York Futures Exchange before moving on to become a wildly successful money manager on Wall Street.
And with more than 35 years of recommending stocks under his belt, Charles has knocked the cover off the ball, compiling an amazing record of success and posting gain after gain for his loyal readers. He is the founder of Park Avenue Investment Club and the Insider Alert newsletters.
Charles is also the author of the highly acclaimed book, Getting Started in Value Investing.