TRADING FANG STOCKS | Alternative Way To Invest in FANG or FAANG stocks.
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- Опубліковано 28 вер 2024
- FANG or FAANG Stocks have been a popular group of new technology stocks, comprising of Facebook, Apple, Amazon, Netflix and Google.
This group of stocks have beaten the indexes considerably over recent years, however they come with risk and considerable drawdowns.
This stock trading method including the MACD indicator, shows an alternative lower risk approach to invest in some of the biggest household names in the stock market. In fact Fang or Faang stocks make up 15% of the S&P 500 index.
The principle is taken from my own personal stock trading strategy, which looks for low risk, high reward setups, Risk/Reward being the key aspect.
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Interesting one Gareth. Thanks. Although I still quite like the weekly MACD crossover under the histogram line for indexes. For the S&P 500 and DJIA in 2020, the weekly MACD crossover under the line would have got you into a good trade around 7% earlier rather than waiting for the MACD blue line to cross the histogram base line.
Good observation 👍
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The simplicity and effectiveness of your strategy is pure genious! Congratulations! I won´t ever be able to repay the value of your teachings, but this much I can do: I click all the YT adds from scammers and spammers that pop up during your videos. I am sure you will successfully invest that YT revenue and grow it over time. It´s the least I can do. Would you use your MACD system on Forex markets and/or commodities?
Excellent strategy. similar weekly strategy can be applied for RSI weekly > 60 also instead of MACD. Stop loss = 20MA weekly. Re-entry is RSI weekly >60 again. Did you tested this strategy in the past by any chance, Please let me know. Appreciate your videos.
Hi Ravi, Only back tested it... I personally use a breakout out strategy with the principles used in the video. The message however, is risk control and staying with momentum.
It would be really interesting to do one such on UPRO and SSO. Poor man's leverage and its results.
love the little guy with the faces :)
Can I ask - do you always wait for friday close to look at this, or do you look daily? And do you always look after close of day to buy/sell position? thank you for great info!
Great video , I was using weekly exit on macd and it is the best with less risk compared to other indicatiors. I did not know fully the entry system. Thanks enlightening on the entry system which is as important as exit to get the final. compounding .
Glad it was helpful!
You don’t always have to think long term. Investing/Trading is as much a tool for shaping your present financial situation as it is for forming your future one. Do you want to buy a BMW next year? Do you want to go on a cruise? Wouldn’t a vacation that was paid for with dividends feel nice?
If you are investing in the hope of buying a house, you will almost certainly be looking at longer-term instruments. If you are investing to buy a computer in the new year, you may want short-term investments that pay dividends or some high-yield bonds.
PRISCILLA DEARMIN-TURNER is my financial Expert .. look her up
The caveat here is that you need to pinpoint your goals first. If you want to go on a vacation in a year, you have to figure out the cost of the vacation and then come up with an investing strategy to meet that goal. If you don’t have a set goal, the money that should be going into that investment will doubtless be used for other purposes that seem more pressing at the time.
In the NFLX example at 3:10, the weekly MACDs and signals crossed each other numerous times in the year before the beginning of the July 2011 drawdown. Why didn't you set a stop loss then? How did you decide to pick the MACD cross just before the drawdown?
Such a simple strategy. Thank you.
You're welcome!
Why do we buy only when above the zero line? This wasn't in the criteria for the similar BTC trading strategy. What's the difference?
Thank you for this valuable lesson! 👍
My pleasure!
Nice video and learn a lot from it... please keep making videos 👍 thx u
It's my pleasure🙏
In this video, your MACD Buy, and Sell rules are so different than the one in your video: "BITCOIN TRADING - Arguably The Best Bitcoin Trading strategy (MACD Indicator)"... Have you back tested them both? Which one returns more profit? Thanks.
Different assets require a difference approach, each behave differently.
Excellent thanks
can i try this with other stocks
But how do you know which stocks to use the MACD on? These examples are backward looking because both did well over that time period.
You dont, but if you have a long term view of any stocks you may as well use this approach to lower your risk
If you start with 10k and before you get an exit signal your trade increase to 20k, and you get a sell signal, and you go ahead and sell, now do you re- enter again on a buy signal and with the 20k or you start again with your original 10k thanks Nick
Great video. Do you use an app to calculate results? Also why don't you use 5-6% Trailing Stop Lost?
No I use Excel - I find the 5-6% trailing stop is too choppy
What if you went short instead of only close? Just flip the chart/indicators.
Very good video, very useful.
Glad it was helpful!
Where do you get your charts?
Nice approach for determine the time, but what is the initial stop loss on these? I.e. how do you determine initial risk and position size?
Hi max, in this particular concept there is no initial stop loss, which is a similar stance to buy and hold, although the macd is the catalyst to exit. My own personal strategy has the foundation of the same principle, but I use consolidation breakouts with give logic and rationale for a stop loss, hope that helps
@@FinancialWisdom Thanks! I just realised that with respect to allocation you mentioned "Kelly criterion" in some places, which makes sense and setting initial stop under consolidation is definitely useful.
How do I transition my current positions into this MACD strategy? For instance, if I currently hold a position in a stock that has its blue MACD D below the signal line do I sell immediately and wait for the favorable crossover to occur again or have I missed the timing of the indicator and therefore I simply hold until the next time the blue MACD line crosses back above and then below the red signal line? I assume I should simply exit the position now and reenter when the indicator becomes favorable again.
Hi TheNamche, Personally.... I would look at the structure of each chart position and place a stop loss with the technical rationale, i.e if there is near term consolidation maybe put a top amongst it, if there is a clear reversal pattern place a stop underneath with wick of the lowest candle. If there is not technical near term reason to place a stop i would exit the position until MACD is positive.
Thanks for sharing.
After you identify the entry signal and place the trade, what is your SL if the signal is a false one?
As stated in the video, the Stop Loss is set at the cross down of the weekly MACD.
IS THERE A DISCOUNT CODE FOR YOUR STRADEGY
There is, just email me
@@FinancialWisdom
WHATS YOUR EMAIL
minute 6 : is it weekly the chart ?
Hi - Yes it is..
Are you do shorts aswell when exit the long trades?
No generally CopyCino, my bias is upwards over the longer term so that is how I trade👍
@@FinancialWisdom thanks, do you use trailing stop loss too with this faang strategy? If yes how to use it?
The EMA line is not used?
DOPE!!!!!!!!!!!
Thanks 🙏
Hi, what is the difference between membership of Financial Wisdom Vs Stockopedia? I think both ventures are from you, right?
Hi Ravi,
No, I'm a member of Stockopedia and use thier service for my fundamental analysis, and I use marketinout for my technical analysis. My membership is to learn and follow my personal strategy.
@@FinancialWisdom got it. I am in for your membership. Hope you will educate. Thanks
Nice video very engaging from beginning to end. Nevertheless, businesses and investment are the easiest way to make money irrespective of which party makes it to the oval office.
Investing in Crypto now is very cool now especially with the current rise in the market now
Stocks are good but Crypto is Better
I wanted to trade crypto but got confused by the fluctuations in price
@@aliciagardner-anderson7202 That won't bother you if you trade with a professional like Expert Williams Peterson.. My first Investment of $3000 Mr James lawson Bryan has earned me profits of over $24,320 within 15days
He's obviously the best I invested £4000 with him and in 9 days I made a profit of £150,000
Can i combine this strategy with multi timeframe? so see weekly macd, if confirm see daily macd golden cross and closed in macd death cross, thanks
Possibly, try back testing it..
LIKE, SUBSCRIBE AND TAKE NOTES!! BEYOND THANKFUL AND GRATEFUL FOR FINDING THIS PAGE!!! THANK YOU FINANCIAL WISDOM!!!! I AM VERY SPECIFIC WITH WHAT PAGES I FOLLOW AND YOU MY FRIEND ARE TOP NOTCH!!
Could we use 2x leverage?
Yes, I would not advise more
So what have we learnt so far....
We need a time machine ...😂😂😂
LOL that would also help...
what about uncle sam
short term gains ;)
No avoiding unless you can use spreadbetting in uk
Norw its MANG 😂
few dislike by the buyers n holders hater
LOL probably
very simple thank you, explanation starts 2:40
I'm sure one could easily find examples where this strategy will produce pure losses and in the hind sight a lot of other strategies will work on these types of charts, but I think the main point here is that these rules make trading mechanical and reduce the influence of emotions on buy/sell decisions. Otherwise good luck picking these companies 10 years ago out of 10K companies available :)
Wise words 👍
Any reason this can't be applied to any stock, or is it better suited to FANG (and similar) stocks because of their volatility?
Very nice presentation. I think your trading system is an hybrid of momentum and swing trading. I love the use of MACD to reduce our drawdown exposure. I'm going to incorporate it into my own trading strategy. My questions are as follows 1. Are there other techniques used by professional traders for this same purpose (i.e to reduce DD)? 2. How can we skew the risk reward ratio to higher proportions if we can't let our winning trades run for higher pip gains? 3. Is it better to use pyramiding and trailing stops to achieve these goals?
Hi Bammy, thanks. Why not join our group :-) There are numerous techniques to limit drawdown each with their own merits. We can skew risk/reward in our favour by doing just that, limiting losses.👍
can anyone tell me where to find good charts with macs indicator on weekly basis?
so next book is "extraordinary popular delusions and the madness of crowds" ? :D
Please make video on Richer Wiser Happier book summary
You enjoy trading buy only stock trading strategies with reduced drawdown and stagnation being the forefront of your goals. This would give you possibility of leverage or adjusted risk / reward for a”greedy” strategy. I think it would be good to cover stock picking in a video. With all these powerful strategies some insight into picking the correct stocks for 5-10 year runs using a desired strategy would be very valuable
I am a quantitive forex trader so for me this is a very different subject and doesn’t depend on filtering randomness but rather good companies? I am trying to put together a long only investment portfolio using MA crossovers for identification of market regime and to increase || reduce my exposure in a stock. Rather than applying this logic to an index I think it would be beneficial to apply this to well priced stocks rather than the extremely high P/E of current popular global stock indexes. What is your opinion on this and could we maybe expect to see a instrument selection criteria or optimization tutorial?
Excellent content Gareth
Is this approach unique to FANG stocks or could one expect a similar improvement from a B&H strategy for most any stock?
It is rather unique, they need to be popular trending stocks taking advantage of crowd behaviours...
We have the advantage of hindsight here . There is no way to know these stocks will perform better in future 10 years ago. And macd zero line cross is equal to 12 and 26 ema cross over we could use that method too
Hi Amal, you are right... The purpose of the video is to really get the message across that by using sensible risk control and staying with momentum you can get generous rewards without having to absorb all the risk.
Any way he is getting more return in long term, around 60 times in long term rather than 28 times with this strategy
Ohhh it is 22.8 not 28
@@lighthouseinvestments2168 hi kale, I think you are missing the point. The risk is considerably less, and the capital is tied up for 5-6 years less. Plus.. we have limited exposure, the buy and holder will have full exposure, meaning this or any stock could have drifted to zero.
Its a simple concept many faill to grasp.
@@FinancialWisdom ohhhh I missed your point.
But now ...22 vs 60
I will have to be right once per three stock selection.
Which I think is feasible for long term investor.
And the advantage of money not engaged will be nullified by tax deductible and activities ( means my time and work ).
So even with your updation... for which I thank you.
But the concept doesn't pass my litmus test.
Love your video. I use the MACD indicator as my go to indicator. Quick question. I use the daily MACD with my stock selections. Would I be better off making my decisions based off the weekly MACD? Thanks for your response
Depends on your style etc, I prefer a more passive weekly.
What would have happened if you had used the EMA 10/EMA 20 cross for the in and out? vs the MACD ?
I use them in conjunction for my trades
Interesting strategy. But how did you calculated the cagr=380% of NFLX? it should be (((Return/100-1)^(1/hold_days))^253 - 1)*100 = 44% CAGR - even so good results
Hi Carsten, I cant recall if i'm honest... through a spread sheet i think, i'll check👍
Please make a video on books of Al Brooks.
Hi Sir same method dual time example if weekly macd positive & then Daily time entry & exit can I apply this Rules to Indian stocks of good market capital stocks. Pls guide sir
Pls tell me is moving avg plot in the chart? I am humble waiting for your valuable guidance thank you
Hi Gopi, It would need to be back tested to confirm. But the principle seems sensible. The only concern with the daily would be the amount of false signals, but it may be worth you back testing to see....
Hi, great presentations. I’m interested. Send me a link.
In the description
Good video. Does it work for short sell? Short entry when the MACD cross down.
Not sure it would need to be proven, there is generally a long bias for such stocks so no doubt much harder to pull off.
Hello, did you use any trailing stop loss with this strategy?
Hi - Just the MACD
What moving average are you using on your weekly chart ? I have been using monthly charts in my stock trading. That seems to minimize whipsaws. I started out using daily charts but found that they were too random and I had too many transactions. Great video!
Hi - I use the 20 week MA
@@FinancialWisdom Thanks!
Question: why would you have entered long NFLX and set the $36 stop loss if you saw a bearish MACD crossover?
thank you for your detail videos. can this stategy apply to other stocks as well? or only good for FAANG stock.
Thank you ! Your channel is gold
Glad you enjoy it!
Would buy and hold of beat this strategy?
Unlikely due to the declines, but remember there is a survivorship bias... I.e. if you were buy and hold on other potential FANG stocks which went bust, you would be holding that loss. This strategy enables you to stay in only good performing stocks. It this risk factor which is important here
@@FinancialWisdom would this strategy work if we use it for TQQQ?
How to determined risk per trade for stocks and other instrument? or how much risk per trade did you use? and if we only use 2% risk per trade what should we do for the rest fund?
Hi RT, my other videos may explain better (Kelly Criterion), but it all depends on the strategy, Personally I use 16% max position size, but of this position size my average stop loss is approx 10%, therefore 1.6% of equity is the likely risk.. Hope that helps?
@@FinancialWisdom if we invest in multiple instrument like commodities, stocks, crypto does the equity combined or seperated? the fiat that doesnt use just let it be to wait for another opportunity?
Thanks
I always combine it. And yes, if no opportunities exist we wait on the side lines until they appear
@@FinancialWisdom thanks for reply, do you short aswell? does the strategy same but just reversed the signal? This strategy works for other stocks? what is the minimum market cap size? and do you trade forex aswell? sorry if i have lots of question.. thank you for valuable lessons..
Thank sir, I'll follow ur advice..
Why not just use dual macd setup here too?
How do you decide what to set the stop loss at?
Spending the next year using the BTC strategy from this channel but w/ results so far I can tell you I'm going to join your paid community soon and start getting into stocks. #NewbieLearning. Thanks, this channel has literally turned me into a profitable trader after nearly 2 years of getting caught in the hype. I can't thank you enough.
Love to hear that ❤👍
So in the case of Netflix the BUY AND HOLD won from MACD except for all the volatility, in the Amazon case is the same (maybe MACD CAGR of 122% against a BUY AND HOLD CAGR OF 235%)? Great channel and great videos :)
Thanks IVO, appreciate the feedback.. All I would say is that buy and hold you always own 100% of the risk so comparing directly with something which has a risk limiting element is always difficult.
Sir, gud pm. Just want to ask of ur thoughts about the 3,10,16 macd set up? Compare to the usual one.. Thanks and stay safe. 😁
Hi, its not something I have a vast amount of experience on...try backtesting it maybe.
I know you probably get bored by this...but absolutely TOP SHELF!
Thanks :-)
Im sold...im gonna learn everything about macd i may join your group
Great 👍
Was Netflix considered a fang stock in 2010 when we invested 😀
Good question ???
Very very nice video sir 👌
I love your video's
Thanks and welcome
Thank you very much, wonderful...
Thank you too!
Great video but you should upload more often.
Working on it!
You doing a great job. Your voice is God gifted, so powerful💪.
Your presentation is awesome👏👍😊
Thank you so much 🤗
@@FinancialWisdom my pleasure sir 🙏
Nice vidio
Thanks🙏
Hey informative video
Just few things
Have you back tested this strategy on the mid cap shares
Can we use the daily chart for mid cap & small cap shares
Hi, without thorough backtesting I'm not sure sorry,