The UNTHINKABLE is About to Happen to Stocks
Summary
Felix begins by highlighting his past success in identifying stocks that were 'written off' but subsequently saw significant gains (10% and 24%). He attributes this not to luck, but to a 'green light test' he learned from Wall Street mentors, which he intends to teach viewers. He emphasizes that a great company isn't always a great stock, using a water park analogy to explain that investors should focus on where money is 'flooding in' rather than 'draining out'.
The 'green light test' consists of three questions:
1. Is the money picking the stock over its peers (i.e., is it beating the market/industry)?
2. Is the stock climbing rather than falling (avoiding 'falling knives')?
3. Has the crowd just noticed, indicated by a burst of buying volume, especially when pushing through a price ceiling?
Felix also stresses the importance of risk management, cautioning against portfolios that appear diversified but are actually filled with 'eight versions of the same falling knife.' He notes a significant market structure shift expected by the end of July and offers a free workshop to help investors review and rebuild their portfolios.
He then introduces three stocks that currently pass his 'green light test':
Felix concludes by offering two bonus stock names in a free report and reiterates the importance of learning responsible investment principles, such as knowing when to sell before buying and not 'marrying' a stock.
Mentioned Stocks
Reasoning: Felix describes Corning (GLW) as a 'shovel pick' in the AI boom, providing the essential optical fiber cables needed for connecting AI data centers. He argues it's a way to profit from the AI surge regardless of specific chip winners. The stock exhibits 'textbook three green lights' according to his test: strong money flow, a climbing trend near its all-time high, and significant volume. He notes it's up a lot from its lows, making it the opposite of a 'beating down gamble'. He warns that it has already climbed significantly and could pull back, emphasizing the importance of position sizing and potential overexposure to AI.
Reasoning: Affirm (AFRM) is a consumer fintech company specializing in 'buy now, pay later' services. Felix highlights its integration into major platforms like Apple Pay, Amazon, and Shopify checkouts, which gives it access to hundreds of millions of shoppers without active chasing. A key reason for money moving into AFRM is its recent transition from years of losing money to actually turning a profit, which is a significant positive signal for Wall Street. The stock's price is pointing upwards with a nice sideways consolidation and an upward trend line.
Reasoning: Rush Street Interactive (RSI), an online casino games and sports betting company, recently closed at a brand new all-time high. Felix notes this is significant because it means there are no prior investors currently at a loss, thus no 'ceiling of frustrated sellers.' It boasts the second-strongest 'money is already there' reading on his list. The company is a rare profitable operator in the online gambling sector and benefits from the ongoing legalization of online casino gaming across more US states. The stock shows money flowing in, consolidations, outperformance against peers, and significant buying volume, matching all three green lights. However, Felix warns that gambling stocks are prone to volatility from moods and headlines, especially state regulation changes, making careful position sizing crucial.