Mark Minvervini
 

Mark Minervini is a world-renowned trader who has achieved amazing results in the financial world. He has written several best-selling books in the wake of his success, and has regular online courses for people who want more personal "coaching". Many would probably be very happy with his "worst annual return" of 128%. Starting with just a few thousand dollars, he has, with an average return of 220% a year for more than 5 consecutive years, achieved a fortune of several million. He has participated in and won several trading competitions, and is referred to as one of the "Stock Market Wizards". His strategy is recognized by a large fan base.

To show that his theories still work, he signed up for the "2021 United States Investing Championship" where he participated in the $ 1,000,000 + department:

Here he has so far (September reading) crushed all competitors and has a return of 277% !!

Links to his books for more detailed information on his strategies can be found here:

Mark Minervini who is Mark Minervini part 1 what does Mark he is good Minervini part 1 Mark Minervini

But enough about the person Mark Minervini, what are his theories all about?

Minervini's trading strategy is recognized as a momentum trading strategy. That represents buying shares that run with elevated speed, at increased volume, and preferably in a positive direction. His strategy uses the advantage of "compound trading" which means interest rates on previous winnings. It is therefore very important to minimize the losses you have so that the return on previous returns will be greater and greater. The strategy is mainly a technical analysis strategy, but it is a combination of stocks that have good fundamental values, but which must also follow his technical criteria. He is looking for "super performance stocks", which can move a lot on both technical and fundamental values. When you are going to "screen" for stocks that follow Minervini's principles, look for stocks that meet these criteria:

Technical criteria (indicators) :

  • The share price must be above both the 150 and 200-day moving average (MA)

  • MA 50> MA 150> MA 200

  • MA 200 should trend upwards in the chart over a minimum period of one month, preferably several months.

  • The share price should trend above MA 50

  • The share price should be within 25% of the "52-week high"  (The closer the better)

  • The relative strength (RS ranking) should be more than 70.

A lot of these criteria can be used with most screeners, with providers such as Finviz. RS ranking, which is a slightly rarer indicator, is not included in all screeners. This indicator is found in the screening program that Minervini uses, but this software can have a little high cost. A link to this screener can be found here.

What he looks at of fundamental values are stocks that are experiencing great growth and increasing margins, what he specifically mentions is:

  • Signs that the acceleration in growth will continue

  • Market position

  • Other potential catalysts

Mark's set of rules that he believes a trader should always follow

  • Determine your stop level before entering the trade

  • Never risk more than you expect to earn

  • Realize good profit when you have it

  • Never let a big gain go against you to a loss (raise the stop-loss as the share price goes up)

  • Only be aggressive if you are approaching gains

  • Scale down your exposure if you have a bad trading period

  • Protect your "breakeven" point ASAP

  • No forced trades - No big losses (let good "setups" come to you)

  • Never average down

 

You now have what it takes to find stocks that can give you "Super Performance" by following Mark's principles. If you follow the link to part 2, we will tell you more about how these shares should be traded.