| How Seasonality Helps Us Beat the Market Our latest breakthrough has to do with an incredible innovation made on a piece of software we debuted in 2023. This software keeps you in the strongest stocks at the right time - positioning you for faster gains. Dedicated readers know I'm talking about our seasonality software. Seasonality is the practice of averaging out the price data of the past to make effective forecasts about the future. For example, look at the chart of seasonality data for the SPDR S&P 500 ETF (SPY) shown below. By averaging out the last 15 years of SPY prices, we were able to forecast last fall at the end of October that the S&P 500 would rally hard through November and into December... Our data suggested a price rise of 3.64% from October 26 to December 5. Annualized, that's a return of more than 33%. Stocks wound up doing even better during that timeframe in 2024, rising about 4.7% over that span - one of the best stretches of performance all year long. And our latest data suggests that this pattern should repeat at the end of 2025... And seasonality works on far more than just the broad markets. You can run your stock tickers through this tool at the website we've set up for registrants for our upcoming seasonality webinar in April. To try it for yourself, register here to attend the webinar and get free access to seasonality patterns on your stocks. For example, here's what seasonality showed us about Nvidia (NVDA) earlier this year... During the last 15 years, the data shows that it has had a strong tendency to rise from January 26 to February 20. In that time, it's been positive through this period all but one year... and its average return through this span was 9.23%. Then it tends to rise again from March 14 to March 29, before taking a break - all in the lead-up to a big summertime spike: Over the last 15 years, from May 24 to August 22 Nvidia has risen an average of 14.4% - with an accuracy rate of more than 86%. It's only skipped out on this rally twice, in 2010 and 2011. How did Nvidia do during its early-year bullish period this year? Even better than expected: It rose 18.3%. If you ask me, you'll want to own Nvidia on January 20 again in 2026. And you might want to consider picking it up in early May, later this year. This system works on the downside, too, as you can see on a seasonality chart of Starbucks (SBUX). From April 26 through May 11, the stock has been negative for more than 93% of the time over the past 15 years. It's also posted an average loss of 3.41% during this time... Starbucks lost a lot more than that last year. It fell more than 13% in April 2024, after it got dumped on a poor earnings report. Think about what this tells us. The timing of seasonality suggests that Starbucks' second quarter earnings reports have been a sell catalyst more than 90% of the time over the last 15 years. Seansonality is an edge in the market well worth trading. But do understand, seasonality is not a crystal ball. It's simply data. It shows us an ever-evolving composite of what has happened in the past. The more relevant and precise history there is to look through, the more effective the data. We knew seasonality was helpful for this function. But we got to wondering if it could do more... and if it had the makings of a full-fledged investment strategy. So we put it to the test... The Breakthrough We designed a way to invest based almost exclusively on seasonality. With this method, you plan ahead to trade only the 50 stocks with the strongest seasonality patterns during the upcoming year. You buy these stocks during their best seasonal periods, then sell once that period has ended. Rinse and repeat as soon as another of the 50 stocks comes into one of its best trading windows. Additionally, you look for stocks that haven't run too far, too fast in the short term. That ensures you're only running with a team of "well-rested horses." Remember, people who own index funds and "set it and forget it" wind up with predictably average returns. They're running teams of horses of wildly varying effectiveness. But for people like you and me who are deeply involved in the markets every day and are putting in a ton of effort to beat the average, you want to find a strategy that optimizes the index approach. That's what the new seasonality strategy does. You still focus on a specific group of stocks, but you ONLY trade the stocks at times when their historical data provides a ton of evidence that it's the best time to hold them. And you reject everything that doesn't have that evidence. (All this is to say, this takes a little bit more work - a few trades per month. But the results are more than worth it.) We ran a rolling test of this strategy from 2006 to 2024, with each year testing the previous 15 years of price data for over 5,000 stocks. And this trading strategy - involving the best stocks to buy at their very strongest times of year, based on their historical price action - yielded a total return of 857%... With performance that doubled the S&P 500 on average every single year. Even more impressive is the fact that, unlike the S&P 500, which entered a bear market in 2008 and 2022, this strategy never lost money for long. This is why the horse-and-buggy analogy makes so much sense. This strategy rejects everything except the fastest, strongest horses with the best track record at any given time. It gets you where we all want to go, only faster and more efficiently... with a lot less pain along the way. If that's not a better way of investing, I'm not sure what is. We're set to open access to this new seasonality strategy on April 8, at 1 p.m. ET. Once we do, everyone who decides to join will start getting automatic trade alerts of the best stocks to trade at their seasonally strongest times of the year. In the meantime, though, we want to do something special to help you understand just how big this strategy is. If you go here and sign up for our upcoming webinar all about this new strategy, you'll be able to access the same seasonality tool I've been showing you today... with a forecast for 2025. Take a few minutes and plug in your portfolio's top holdings. You'll see when they're set to surge or sink... and make sure you write down those dates as a trading plan for 2025. Once you see how this tool works firsthand on your own stocks, my hope is you'll realize how powerful it is to invest this way. More details on the strategy, including limited time access to the seasonality tool, and registration to this free event right here. All the best, Keith Kaplan
CEO, TradeSmith | 
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