I am overjoyed. Deliriously happy. Straight-up giddy.
Because once again, those monolithic institutions that I tolerate with contempt have handed me and my readers profits on a silver platter.
It’s almost too easy, really. That’s because the Big Four institutions – the news media, Wall Street heavyweights, Madison Avenue, and Big Government -are vying to be “Masters of the Universe” and keep on creating what I call “Reality Gaps.” They do it all day, every day, as they conduct “business as usual.”
Reality Gaps are the huge chasm between what’s being written, or shown, or talked about… and where the true realities lie.
A Reality Gap is the “space” between a story that glosses over or disguises a deeper meaning… and the money-making opportunity that is contained in that deeper, more important story.
And in my 35 years of experience, the more the Reality Gap obscures the underlying truth, the more money-making potential there is.
Let me give you a recent real-life example that illustrates the point beautifully.
Recently, the Democratic Party held its final debate before the Iowa caucuses. Every story that covered the debate had, as its lead point, some variation of USA Today‘s first subhead: “Democrats debate Medicare for All, Affordable Care Act in Iowa”.
And that made me very happy – and not because I’m passionate about any of the many sides of the healthcare debate. No, I’m elated because I’m currently passionate about healthcare stocks.
And because the ongoing healthcare argument narrative in general – and the recent debate in particular – keeps massive amounts of money flowing into this stock sector. In just two days after the debate, members of the beta test for my new service which tracks money flows saw a chance at a 107% winner and a 105% winner – both in the healthcare sector.
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And so, the media-created Reality Gap sends money flowing into particular stocks… and we cash in again and again.
And with the Iowa Caucus just days away, followed by Super Tuesday just one month later, healthcare is sure to be all over the headlines, giving us plenty more profit opportunities.
Here’s how you can get in on it…
The Big Four Pour Fuel Onto the Fire
Healthcare stocks have been on a tear. And that’s fueled by all the discussion on the healthcare topic that is part and parcel of a presidential election year.
So with money already flowing into the sector, the fact that Democratic debate in Iowa centered around healthcare brought additional new attention, and more importantly, new money into the sector.
The reality gap was this: The news media was focused on the nature of the debate – whether to keep Obamacare and upgrade it, or switch to a Medicare-for-all system.
The truth is: The markets know any publicity is good publicity. It doesn’t matter where candidates land on this. The fact that they’re all talking about healthcare – ad infinitum – puts eyeballs on the healthcare system. And the money flowed in. Price on the sector continued to pop, putting our trade in the Health Care Sector SPDR (XLV) over the top:
With the debate approaching, we entered Big Pharma stock Merck & Co. (NYSE: MRK) with even faster results, raking in 105% in just 3 ½ trading days:
Reality Gaps show up in many places, not just the news media. Wall Street wants us to believe it’s “buy and hold” mantra. Madison Avenue will say just about anything to get us to buy the latest shiny object, or watch the newest streaming service. And Big Government just wants your vote (and to hold onto power).
The way that everyday investors beat this rigged system is by seeing past the smokescreen and trading the story that is really moving markets. And right now, that story is how all the attention that the election is giving healthcare is creating a huge flow of money into the sector. While all eyes are on healthcare, stocks like XLV and MRK should continue to outperform.
Great trading and God bless you,
D.R. Barton, Jr.