It's almost Glen Scheinberg's time to shine...
At just 27 years old, Scheinberg was working at Goldman Sachs' (GS) algorithmic trading desk when he was poached by quantitative hedge fund Millennium.
He was immediately made a portfolio manager – rare for somebody so young. And his team had pretty much one job every year...
Make billions of dollars in a matter of weeks.
Scheinberg and his team got together back in 2014. They've been one of the most successful teams on Wall Street ever since.
And it's all because of one "golden trading window" that the team spends most of the year prepping for.
Today, we'll take a look at this rare window... And we'll explain how all investors can take advantage of it.
Scheinberg made a name for himself in 'index rebalancing'...
Big stock indexes like the S&P 500 and the Russell 3000 aren't static. From time to time, they revisit which companies are included.
When companies merge, go bankrupt, or rise or fall a lot in value, they might drop in or out of qualification for certain indexes.
It's not practical to make all of these changes exactly when they occur. Instead, different indexes choose particular "rebalance days."
The S&P 500 rebalances quarterly. The Russell indexes rebalance once a year.
And Scheinberg makes most of his money in the weeks leading up to those rebalances.
Back in 2020, Scheinberg's team was Millennium's No. 1 performing fund...
We don't know exactly what stocks it invested in. We do know that Tesla (TSLA) finally joined the S&P 500 that year... and its stock rose about 190% in the six months leading up to the rebalance.
That's no fluke. Scheinberg's team consistently makes Millennium billions of dollars ahead of an index rebalancing. Tesla is one in a long string of stocks that surge when they join a major index.
Over the past eight years, Scheinberg's strategy has amassed a lot of copycats. Big names like Citadel, Point72, and Schonfeld all copied Millennium.
And it's no wonder they do. More than $100 billion usually trades the day of a reconstitution... and trillions of dollars trade in the weeks leading up to it.
It's a massive moneymaking opportunity for folks who get in early. Companies that are about to join the small-cap Russell 2000 have historically outperformed the whole index by 23% in the first half of the year.
While Wall Street is preparing, most everyday investors don't even know the Russell rebalance is coming up...
We're in the midst of the best two months of the trading year... and it's all leading up to June 28.
Out of all the indexes, we tend to favor the Russell rebalance. The Russell 2000 in particular features the market's tiniest stocks. And they often experience the biggest price swings.
Many of these stocks have never been covered on a major index before. This is the first time they're going to be purchased by large institutional investors.
My team and I just released our list of stocks that could double between now and June 28. We've pored over hundreds of prospects that could ride this wave higher.
And we've narrowed it down to the five with the best chance of joining the Russell – and soaring in the leadup to rebalancing day.
All five are still trading below our recommended "buy up to" prices as we go to press. But the window to scoop them up is closing... fast. For a short time only, learn how to access our recommendations right here.
Investors have six weeks to position themselves for outsized gains. You can bet that's what Glen Scheinberg and his team are doing. Be sure to join them.
Regards,
Joel Litman
May 17, 2024
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