Louis Navellier’s Dark Pools Summit is a presentation published by InvestorPlace in which Navellier talks about “dark pools.”
He says that under his guidance, you can make money off of those dark pools. The header reads:
“The ‘King of Quants’ reveals how to capitalize on Wall Street’s ‘hidden’ trades – before they move the market – for the chance to make up to 500% gains or more.”
In this piece, we’ll be taking a closer look at the presentation to examine whether Louis’ claims have merit so that you can decide whether it is something you’d want to consider.
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What is Louis Navellier’s Dark Pools Summit?
Louis Navellier’s Dark Pools Summit focuses on “dark pools,” which Brit Lyle (the presenter hosting the event) describes as “Wall Street’s most sacred inner sanctums, a hidden world where the rich go to get even richer.”
He says that billions flow through these dark pools and they give Wall Street access to a secret pipeline of unimaginable wealth.
The argument is that if you know what’s happening in the dark pool, you can predict how stocks will move.
“Want to know where Tesla is headed next?
Keep your eye on the Dark Pool.
Is the recent run in Facebook going to last?
Keep your eye on the Dark Pool.
Should you buy shares of that hot new EV startup?
The answer lies in the Dark Pool.”
Due to this predictive power of dark pools, the one percent keeps this secret “close to their chest” keeping the everyday American away.
And that’s why Louis Navellier decided to do the presentation: he says that he wants to pull back the curtain on the hidden world of dark pools to show you, the average American, how you can see amazing gains.
What is a Dark Pool?
According to Louis Navellier, dark pools are private stock exchanges where the “big boys” on Wall Street place their trades.
While regular investors buy and sell stocks on public exchanges like the NYSE or the NASDAQ, big institutional investors don’t. They trade on private exchanges that are better known as Dark Pools.
Navellier says that the big boys opt to trend this way because of the sheer volume of their trades. He says that when the individual investor buys what he would consider a lot of shares, it is still nothing compared to the orders that the institutional investors place.
He says that when they buy or sell stocks, they trade by the millions or even tens of millions. Such large trades affect the price of the stock.
“When a Main Street investor buys a few shares of stock it’s like a few snowflakes falling gently on the ground… there’s not much impact.
But when Wall Street enters a trade it’s like an avalanche falling down the side of a mountain… watch out!
The price will move… and move quickly.
If any one of the “big boys” were to buy millions of shares on the public exchanges, their own order would drive up the purchase price before it could get filled…
And they’d never be able to get in at their target price.”
That’s why they opt to trade in the dark pools to trade at the prices they want.
Although the word “dark pools” sounds sinister, there is nothing illegal about it. Regulators are aware of their existence and they allow institutional investors to trade away from public exchanges and remain confidential until after the trade is reported to avoid immediate market impact.
Once the trade (that has been fulfilled in a dark pool) is reported, it almost always affects the stock price.
Trading in dark pools is more common than you’d imagine (if you had never heard of them before) because up to 40% of all trades in the stock market happen there.
How Louis Navellier Takes Advantage of Dark Pools
While most analysts see Dark Pools as problematic – from the individual investor’s point of view – Louis Navellier sees them as an opportunity for investors to get ahead of Wall Street’s biggest moves.
“Years ago, I asked myself… what if I could get ahead of Wall Street’s biggest moves?
What if I could use my high-speed computers to develop a system that knows what Wall Street looks for when it’s considering a massive stock purchase, before they secretly pour billions into a particular stock using the Dark Pools?”
In doing so, he intends to forestall those moves so that when they are reported and the market moves a certain way, he will benefit from trading in a manner that capitalizes on the move. This is often referred to as “following the money.”
Louis says that he developed a system that can determine the massive buying and selling that takes place in the dark pools before it moves an individual stock. This system has led him to some extraordinary winners.
He gives examples of such winning trades, including:
“Enterra Energy for 273% gains…
Spreadtrum Communications for 172% gains…
And Nutrisystem for 169% gains…”
Knowing how big investors are trading benefits Louis Navellier in two ways:
- When he picks a stock, he looks for stocks where Wall Street is building a massive position because those often are about to take off.
- For those stocks he already has in his portfolio, he monitors Wall Street’s buying and selling to gauge whether he should maintain his position to accrue greater gains or get out and closeout gains to avoid future losses.
He says that this has enabled him to beat the market by 6-to-1 several years in a row.
When he makes a recommendation, you don’t have to use the dark pools as a trading platform like the big investors. You can trade on your standard accounts at Schwab, Fidelity, E-Trade, etc.
How does Louis Navellier anticipate Wall Street’s moves?
Louis says that predicting those moves is easy because they follow certain patterns when deciding what to buy or sell. He says that he knows this because he has worked among them and observed how they have invested over the past 40 years.
He says that he has been one of them, something he talked about in his “I’m a One-Percenter” presentation.
Louis says that when looking to invest in a given stock, managers on Wall Street look at one metric that tells a lot about how risky a company is and the capacity for steady growth. That metric is Earnings.
“…earnings are kind of like a company’s ‘report card.’
It shows how the company’s doing…
A company with strong earnings is making money, managing it well… and can use that money in the future to improve its products and develop new ones… or pass that money on to shareholders in the form of dividends…
Which means it’s less risky and poised for stable growth… something Wall Street absolutely loves.”
However, Louis says that they don’t just look at earnings in the broader sense. He says that they put “earnings” into eight different categories and size the companies up that way.
The eight categories are:
- Positive Earnings Revisions
- Positive Earnings Surprises
- Increased Sales Growth
- Expanding Operating Margins
- Strong Cash Flow
- Earnings Growth
- Positive Earnings Momentum
- High Return on Equity
He says that Wall Street looks for companies that have all these factors lined up. If their targets are missing some, they move on.
Each factor has an assigned value, as Louis explains:
“What I’ve learned is that each of the 8 factors must meet an assigned value.
For example… the 4th factor, operating margins. Wall Street needs to see that operating margins have increased by at least 20% over the course of at least a year.
The 6th factor, earnings growth… Wall Street needs to see at least 15% growth on that one.”
With that in mind, he designed his system to create an “earnings profile” for each company based on the eight factors and assign it a score he calls a “quantum score.” The more attractive the profile, the higher the score and the more likely it will attract Wall Street investors.
To implement the system in the broader market, he says that he programmed his high-speed computer system to scour over 5,000 stocks across the market looking for companies with high quantum scores.
Louis Navellier’s Trade Recommendations
Navellier says that he doesn’t recommend big companies because they earn mediocre returns. He opts for smaller companies:
“But every now and then, Wall Street piles into smaller, off-the-radar stocks… those are the stocks my system is engineered to help me identify…
And that’s where the massive gains are made.
Now, let me be clear about one thing: these are not penny stocks.
After all, most Wall Street firms are forbidden from investing in penny stocks anyway.”
So, he goes for small companies, but not too small that they are penny stocks.
He prefers small-cap stocks because they have massive upside.
Louis put together a list of small companies that have quantum scores above 90 because they have attractive earning profiles.
He has included them in a special report called Five Breakthrough Stocks That Could Soar 1,000% in Total!
You can get a copy of this report if you sign up for his advisory service called Breakthrough stocks.
On top of that, you also get another special report called The Dark Pool Investing Primer.
Inside, Louis goes into further details concerning the eight different earnings categories that he mentioned earlier. He explains how they each play a role in attracting the attention of institutional investors.
He also explains how Wall Street executes its trades in the Dark Pools.
Who is Louis Navellier?
Louis Navellier is a newsletter editor who publishes his work via a financial publishing company called InvestorPlace. It is one of the oldest publishers of its kind.
In addition to editing Breakthrough Stocks, he is also in charge of other advisory services like Power Options, Accelerated Profits, and the most popular of them all, Growth Investor.
Louis has been in the finance sector for more than four decades during which he has made a name for himself as one of the most accomplished writers in the industry.
But Louis doesn’t just edit newsletters, he owns a money management firm called Navellier that manages billions of dollars for clients.
He has also published a best-selling book called The Little Book that Makes You Rich.
A closer look at Breakthrough Stocks (newsletter)
Breakthrough Stocks is one of the newsletters that Louis Navellier publishes via InvestorPlace. He says that when you join, it will change the way you view the markets and learn what moves them.
To make recommendations to his Breakthrough Stocks subscribers, Louis Navellier has a system that is designed to scour the market for small-cap stock opportunities.
He rates the stocks using his quantum score system and if a company has a rating of above 90, it means that it has an excellent earnings profile that typically attracts the attention of the big boys. This is the kind of stock he recommends.
Here are the benefits you get from joining Breakthrough Stocks:
- Regular recommendations and updates concerning the market every month. He typically recommends about four stocks every month.
- The aforementioned special reports are for free.
- Breakthrough Stocks Every time Louis recommends a stock, he posts it on his website and emails it to you. You can sign up to be receiving text alerts when these alerts are sent out.
- 24/7 use of the Members-Only website. You have access to the members-only website where Navellier posts his research, recommendations, and market commentary.
Breakthrough Stocks Pricing?
The normal cost of signing up for the newsletter is $2,999 per year but since Navellier is running a marketing campaign, you get to sign up for $1,595 for 12 months.
However, it renews at $2,195 per year after your first year, as stated at the bottom of the order page:
“Your subscription to Louis Navellier’s Breakthrough Stocks will automatically renew on an annual basis after your initial term until you cancel. Upon renewal for your Breakthrough Stocks subscription, we will charge you $2,195 (plus any applicable taxes) to your payment method on file.”
The Breakthrough Stocks Refund Policy
There are no refunds and Louis Navellier explains the reason for this:
“And remember, because members of Breakthrough Stocks will immediately receive 5 stock recommendations to make right now… there are no cash refunds on this offer. I don’t want someone joining who is just going to see 5 of my top recommendations and then ask for a refund.”
You can get the second year of subscription for free if at the end of 12 months, “you haven’t seen seven, 100% winning picks in [Louis Navellier’s] model portfolio.”
Closing Remarks on Louis Navellier’s Dark Pools Summit
In Louis Navellier’s Dark Pools Summit, the discussion focuses on investing in the stock market by trying to predict how institutional investors will trade in the dark pools.
We have established that dark pools are unique exchanges where institutional investors can discreetly trade large numbers of shares before they have to reveal their transactions to the public. Dark Pools allow those investors to buy or sell stocks at desired prices because making such moves in the public exchanges would expose them to price pressures owing to the trade volumes involved.
Louis Navellier says that he has designed a system to predict where the big investors will place their bets and he hopes to cash in on the impact that comes after those big trades are made public.
He claims to have already used it to spot profitable trades and he gives examples of those trades.
That being said, although Louis has a strong track record, his recommendations can still make you lose money because his system is not 100% guaranteed to make the right predictions.
Before you go…
Want to see my no.1 recommendation for making money online?
This made us 6-figures in the last 3 months: