Those of you who know my work know that I love exploring potential advancements and shifts in industries like automobiles, energy, media, and farming, but it’s crucial that we also consider what the future of investing has in store for us! After all, investing in and of itself is an essential component in shaping the world’s economic trajectory.

The rise of technologies such as artificial intelligence (AI) will revolutionize the investing industry in the next decade. As investors, we must embrace the change with Big Data, AI, and cloud computing.

Today, investing is dominated by human decision-making. Which means you’re relying on news sources and financial advisors for guidance. In the (near) future, however, the smart money will follow an AI – a powerful technological tool that will make investment decisions for us, ensuring optimal returns and financial success with minimal effort on your part.

For my part, I’ve already embraced the era of quantitative finance and have begun putting it to use to better serve my readers. So, over the next several days, allow me to introduce you to the world of quantitative finance with three breakout stocks (one highlighted each day through Thursday) that have been flagged by our proprietary breakout system.

Only one of these stocks will be my pick for Thursday’s Fast Money Line event, so be sure to tune in Thursday at 4 p.m. Eastern to find out which one our system identified as the breakout stock to buy.

Killing It With Quant

In 2022, while most investors were getting crushed by one of the most brutal bear markets ever, quantitative investment strategies were actually making their investors a ton of money. 

One of the world’s most famous quant firms – AQR Capital Management – surged 40.9% higher through November 2022. 

Two other top quant funds – Aspect Diversified and The Lynx Program – were up more than 30% in 2022 as of November. Another two – Systematica Blue Trend and Wadhwani Trend Plus – were both up about 30%. 

Quant funds killed it in 2022.

That’s because quantitative strategies don’t succumb to the greatest flaw of the human investor – their emotions. 

Humans are emotional beings. Obviously, great investors suppress their emotions when making investment decisions. But suppression is different from elimination. And no investor – no matter how hard they try – can eliminate emotions from their investment decisions. 

That’s the great shortfall of the human investor. At some point, they always get emotional. And when that inevitably happens, they always make a bad decision. 

We’ve all been there before. It’s no fun. 

But quantitative investment strategies eliminate such emotion. In doing so, they eliminate bad investment decisions. They enable investors to consistently make the best investment decisions possible, regardless of whether we’re in a bear or a bull market, or if the economy is booming or busting. 

Quantitative investment strategies remove emotion and guide investors to the best investments in any market. 

That’s why, over the past year, my team of data scientists and myself have developed, tested, and fine-tuned a quantitative trading system to help crush the market. 

We realized that the era of human-driven investing is drawing to a close. The era of machine-driven investing has arrived. 

And if 2022 taught us anything, it is that investors who fail to leverage the power of quantitative finance to uncover the best stocks, will get crushed by those who do… 

We want to be the investors doing the crushing, not the ones getting crushed. 

So, we built a quantitative trading model to help us do just that. With it, we leverage the power of machines and big data to always beat the markets.

We beta-launched that model just five months ago, in the depths of the 2022 bear market. Since then, it has indeed crushed the markets. 

While the market has struggled over those five months, our system has identified stocks that have gone on to soar as much as 25%, 36%, 73%, and even more than 1,000%.

Seriously. Our quant model found a stock that popped more than 1,000% over the past five months alone… 

To get an idea of how it’s possible to make serious money in the stock market by leveraging the power of quantitative finance, let’s look at a stock our system has just identified … 

Breakout Stock: Nine Energy Service Inc (NINE)

Nine Energy Service (NINE) is an oilfield services company that helps unconventional oil and gas resource development across all North American basins and abroad.

Because the company’s performance is closely tied to the overall health of the energy sector, NINE was one of the few stocks that managed to soar in 2022.

In recent years, the industry has faced challenges due to low oil prices and a shift toward renewable energy sources. However, Nine Energy Services has been able to maintain its revenue and profitability through cost-cutting measures and a focus on technology-driven solutions.

The company has a strong balance sheet, with minimal debt and a solid cash position. It also has a diversified customer base, which helps to mitigate the impact of any one customer’s decline in activity.

In terms of growth prospects, Nine Energy Services has been investing in new technologies and expanding its product and service offerings. This can provide opportunities for future revenue growth, but also comes with added risk and uncertainty.

Overall, Nine Energy Services appears to be a financially stable company with a strong market position and potential for growth. However, as with any investment, it is important for investors to carefully consider their own risk tolerance and do their own research before making a decision to invest.

Why Our System Flagged NINE

In the beginning of 2020, NINE stock underwent a significant decline (known as a Stage-4 decline), which resulted in a significant drop in its value. Following this decline, the stock entered into a sideways pattern of trading known as a Stage-1 consolidation pattern.

This pattern persisted for approximately two years, during which time NINE struggled to break through its horizontal resistance level. However, in March of 2022, NINE finally managed to break above resistance. Unfortunately for those who bought the stock here, this was a false Stage-2 breakout, and NINE fell back into its consolidation pattern.

The true Stage-2 breakout for Nine Energy occurred in the fall of 2022, when it broke out of its multi-year Stage-1 consolidation pattern on high volume. The steep angle of this breakout suggests that the stock experienced a significant amount of strength in this move, which is a positive indicator for its future performance.

Now, let’s look at the same chart again. This time without the “stage” trend lines, but while adding in its 50-day, 100-day, and 200-day moving averages (MAs).

From a purely technical analysis perspective, this is a beautiful chart! All three moving averages are trending steeply upward, which is what we like to see.  

For instance, the 50-day MA is positioned above the 100-day MA, which in turn is above the 200-day MA. This is a strong indication of a healthy Stage-2 breakout, as it demonstrates a consistent and steady upward trend.

What’s more, during the brief consolidation period of the Stage-2 breakout, NINE has found support at the 50-day MA, suggesting that this MA could potentially serve as a strong foundation for the stock moving forward.

But you’ll need to tune in Thursday to find out whether this is the stock we’re recommending or not! There’s a lot of time between here and Thursday, so our system could identify a new trend forming that changes the current standings for prospective stocks.

I’ll be back in touch tomorrow with more information on our breakout trading system, plus more information on our second breakout trade.

Stay tuned!