How Our Double-Digit ETF Beat The Odds By 100%

IMMEDIATE ACCESS: You can find the transcript/video of the beginning of Episode 4 of the Monthly Milestone podcast below.

 

 

Nikia Wade: Hello everyone. Welcome to the Monthly Milestone podcast. I'm your host, Nikia Wade. Today we have a very special guest with us, Mr. Matt Maley, as seen on CNBC. Anyone who understands investing knows the name Matt Maley as well.

Matt, you boast over 40 years on Wall Street and I know that your schedule is busy. So thank you for taking the time to join us on the Monthly Milestone today.
Matt Maley: Nikia, it's great to be here. It's always fascinating to talk to you about the markets because I'm so enthusiastic about it. 

Nikia Wade: Matt, I was taking a look at your portfolio and you have quite the track record, as many know around the country. One particular play did stick out in particular. So there was an ETF that you recommended. I call it the double-digit ETF that beat the odds by 100%. And I'll get into that in a little bit of why that's the way that I see this ETF.

Without revealing the name of the ETF, when I was looking at your track record, I saw that when you initially recommended it to your readers, you projected about a 32% gain, which is nothing to turn your nose at at all.

And you even said in your recommendation that it might be a little bit of a risky move. Somehow, you managed to squeeze out not 32% but actually over 65% gains. That’s double the amount of what you projected. So I thought that that was just incredible.

It's rare that people get to have this one-on-one time with you and get a little bit of insight as to how your mastermind works and how you approach the stock market.
So if you could just tell me, without revealing the ETF’s name, what did you love about it? How did you identify the ETF as a good play, and how did you discover the opportunity? 

Matt Maley: It's funny because my background is that of a trader, even though I'm a macro strategist. I spent the first 25 years of my career as a trader, and I covered the biggest trading desks and the biggest institutional changes on Wall Street.

And in that way, I really got a good idea of not just thinking about what should happen in the marketplace, but what is going to happen. We always want to understand the theoretical aspects and the fundamental aspects of any stock or any ETF or any market.

But, you know, when you get it, when you spend that much time in trading, you really have to look at a broader array of issues. You look at technical analysis. You look at sentiment indicators. You look at positioning.

With too many people on one side of the boat, in any given group or even an individual stock, if too many people are along it or too many people are shorted, that means there's nobody left that's left to take the other side.

And so it's usually a contrarian indicator. So I try to combine all these different things together to really try to get the best. But I really try to pull this together to get the real key turning points in any kind of stock or or individual sector.

And this particular one, it worked out really well because when I was seeing it outside of the stock market, I was seeing something going on in the interest rate in the bond market in the interim in terms of interest rates.

And I saw a turn going on there, and I knew this group hadn't reacted to it yet. And I knew from my experience and historical data that the correlation was very strong. I knew that it wouldn't be long before this ETF would indeed react to that.

So that changed what was going on in the bond market. So that worked out really well. And then, of course, one of the things that's so great now for individual investors is that we have these ETFs.

In this particular case, it was a leveraged ETF. And this is something the individual traders didn't have. It was only something that institutions could trade for years. And even some of these ETFs were available a decade ago, but they didn't have the liquidity and the volume that made them something that individual traders could use. And now we can have the tools to do some of the things that these institutional guys have been doing for years that we couldn't do. And so these kinds of things all kind of came together. I use my years of experience to work with them, and the trade worked out very, very well.

The Things Winners Are Made Of…

Nikia Wade: I love it. And then that's exactly why I call it the ETF that has beat odds by 100%. That’s just impressive. You already gave the readers a heads up that it may be a semi-risky play. And then, you managed to squeeze out double of what you projected. I think that really is a testament that you're not somebody that's just throwing a dart in the dark.

You've done your research. You have the background, and you have that keen eye to not just make projections, but to know what we really should be expecting as well. Were there any other key things that stuck out to you when you decided to recommend this play? We won’t reveal the ETF’s name yet. Was there anything else that stuck out in your mind at all at that time? 

Matt Maley: Yes. I wanted to let people know that I think we could get a really nice return here. At the same time, there's a certain amount of risk involved, and that's why we put a stop out level. If the ETF fell to a certain amount, we'd get out of it and limit our losses.

That's one of the most important things that we try to portray is to use your good risk management. You want to cut your losses and look for a better entry point. It was very important for me to put that out there.

So I told them this could be a risky one. So be very careful. We knew that if it goes down too much, we'll get out quickly. But it kept going higher and, again, it was a leveraged ETF, which isn't like options (where those can go to zero in a matter of time).

These things can move in a big way. But it does give you a little bit more risk. And when I combined that with the timing with what was going on in another market, that really gave me the impetus that we can go ahead and move forward here.

Because every single time in history something happened in the bond market, this had happened before too long, and I knew that it was only a matter of time before it did. And sure enough, that correlation did come into play. And we saw a really nice rally in this asset.

The Best Type of Name Dropping

Nikia Wade: Beautiful. Well, I'm sure that everyone is just wondering what ETF did you call out and you managed to get twice the amount of the projected gains for your exclusive readers. Let's go ahead. Can you tell them which ETF this was?

 

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