I Know First
Weekly Newsletter | May 14th, 2020

We’re happy to share our best article and stock prediction of the week:

• Top Trade Ideas – Most Aggressive Stocks To Buy Based on Algo Trading: Returns up to 210.71% in 1 Month

• Top Featured Article – The Next Frontier of Artificial Intelligence Predictability in Financial Markets

Need to Know First!

• High Volume Stocks Based on Genetics Algorithms: Returns up to 21.93% in 3 Days
• Best Energy Stocks Based on Machine Learning: Returns up to 78.27% in 7 Days
• Herbalife (HLF)  has gained 19.13% since April 26, 2020 following I Know First’s explanation of how Herbalife is a great way to gain exposure to the multi-level marketing industry.
• Nvidia (NVDA) Stock is up 18.55% in the last month since April 1, 2020 when a bullish I Know First forecast that explained how COVId-19 actually boosts Nvidia’s top line.
• Facebook (FB) returns are now up to 11.72% since April 27, 2020 when an upside prediction showed how the tech stock can continue pulling positive returns. 

Weekly Winning Forecasts

Stay Ahead Of The Curve: AI Weekly

The Next Frontier of Artificial Intelligence Predicability in Financial Markets 

The developments in computing and artificial intelligence have coincided with massive disruption in our economic structure, with many jobs being automated out of existence. Soon, the 5 million truck drivers in the U.S. will be left without jobs as autonomous vehicles powered by Artificial Intelligence render their work unnecessary. More advanced jobs are not safe from the development of AI either. For example, machine learning algorithms can now outperform radiologists at identifying diseases from medical imaging.

As the technology of Artificial Intelligence is slowly taking over many fields of work, the financial industry is one in which its effects could perhaps be the most profound. This MarketWatch article written by I Know First CEO & Co-Founder Yaron Golgher delves deeper into this complex subject. 

Read more.

Top S&P 500 Stocks: Daily Forecast and Global Model Performance Evaluation Report

In this stock market forecast evaluation report, we will examine the performance of the forecasts generated by the I Know First AI Algorithm for top S&P 500 stocks which were daily sent to our customers. Our analysis covers the time period from 19 June, 2019, to December 8, 2019. The report also demonstrates how our Global Stock Picking method compares to our Daily Forecast model and how those generate predictions resulting in returns that beat S&P 500 even during the volatile times in 2019.

The report featured many highlights! Stock market forecasts that were generated by our Daily Forecast model obtained positive returns for all time horizons and outperformed the S&P 500 for all time horizons (3-days to 1-year). Moreover, we observed a consistent positive effect of signal-based filtering, besides one exception in the 90 days time horizon, additional screening by signal always resulted in higher performance. On top of that, the Global Model improved the performance even further – our algorithm’s forecast according to this new model enabled a more flexible trading strategy that generated robust returns compared to both the S&P 500 Benchmark and the traditional model performance on longer horizons.

Read more.

NVDA Stock Forecast: Why Nvidia Deserves a Price Target of $320

VDA breached the $300 price barrier last April 27. It did it again last May 6, and it closed at $297.79. This is still higher than April 2’s closing price of $247.03. Earnings for 1QFY2021 will be released on May 21 and there is still potentially for the stock to make more moves to a new price target of $320. The I Know First algorithm is extremely bullish on NVDA, particularly over the 1 year time horizon.  

The COVID-19 catalysts for gaming and data center are for the long-term. More people are now being compelled to become PC or Switch gamers. More corporations are now buying very expensive Tesla GPUs to accelerate their cloud computing & work-from-home initiatives.  Anything that boosts the GPU sales of Nvidia is a good reason to buy more of its stock. GPU sales account for almost all (87%) of Nvidia’s annual revenue.

Read more.

Stock Filtering by the I Know First Signal and Predictability Indicators

In the following we explore a very simple analysis of these predictions: for each trading day from January to June 2016 we filter stocks from the S&P500 universe by their short-term I Know First predictabilities and signals and compute their average close-to-close returns per trade. In this analysis the predictabilities are filtered by fixed levels and the signals by daily quantiles.

Mean returns per trade consistently increase along both I Know First prediction measures, peaking for the highest predictabilities and signals. Thus the two indicators are informative at all levels and, on average, higher indicators imply higher returns. The highest average return per trade achieved in this analysis (corresponding to the highest predictabilities and signals) equals 0.27% for the considered time frame versus a daily close-to-close mean return per trade of 0.08% for the S&P500 constituents in the same time period.

Overall the analysis shows that the mean returns per trade and the mean return per trade to standard deviation ratio consistently grow with the I Know First indicators.

Read More

BABA Stock Forecast: Alibaba Still Deserves A Price Target of $240

Lingering doubts about China’s honesty over its COVID-19 victory means most investors doubt there is an actual strong rebound in that country’s e-commerce industry. This distrust is bad because 90% of Alibaba’s e-commerce revenue comes from China. Misplaced skepticism means BABA will trade sideways until May 20 when it releases its earnings report.

That being said, online sales are surging in China as it is in COVID-19 affected Europe and United States. Alibaba is the intermediary that connects China suppliers to B2C retailers. Now is not the time to lose hope though.  Alibaba’s stock still deserves a one-year price target of $240. The global fear over COVID-19 further fortifies the importance of online shopping.

Read more.

Want to learn more?

• Warren Buffett Investment Strategy: How to Profit Amid Coronavirus
• Algo Trading: Take Advantage and Learn How To Use I Know First’s Interactive Interface
• Investment Strategies and AI: New Tools For Time-Proven Practices

Letter from the CEO

Dear Readers, 

The markets continue to defy expectations. Despite Coronavirus, stay at home orders, and more, the Nasdaq Composite Index on Thursday turned green for the year, driven by shares of Microsoft Corp., Advanced Micro Devices Inc. and Tesla Inc.. This exposes an interesting dichotomy in which the economy is struggling with unemployment at record highs, unprecedented business closures. Yet, at the same time, in 2020 so far, the Nasdaq is up by 1.6%, the Dow is down by 14.7%, and the S&P index is down by 9.3%. While not all indices have recovered yet, one would expects the markets would have taken a turn for the worst given all of the difficult economic conditions.

Even in these volatile and unpredictable times, the I Know First Predictive Algorithm managed to identify multiples market opportunities over the last week. Specifically, I Know First’s High volume low price stocks outperformed the major indices recently. Over the last two weeks, the package had an average return of 28.8% in comparison the the S&P’s meager 3.28%. During this period, QEP was jumping by 55.5%, MTDR gained 72.5%, and AR soared 39% as predicted by the AI algorithm. This package has been consistent over the 7 day time horizon too; in the 7 days forecast 70% of the stock picks were jumping more than 17%. That’s not all too, in the last 3 days, this package had an average return of 9.4% vs an average return of 2.8% for the S&P 500 index. Some notable returns  included RIG with 21% in 3 days, MTDR with 19% and SM with 10% in just 3 days. The High Volume Low Price Stock package includes stocks currently trading between $5 and $10, with an average daily trading volume above one million dollars. You can join to this package here!

This hasn’t been the only interesting package recently. The top 10 stock picks over 3 days and 14 days, best energy stocks, most aggressive stocks, and bitcoin price predictions have all seen great success with some returns surging above 200%. You can know which stocks and packages to watch by reading the weekly newsletter each week. For example, last week we told you to buy ATVI before earnings. Since then, the stock has gained nearly 10%. It’s not too late to know what opportunities lie ahead, you can find out what’s next here.

Warmest Regards

Yaron Golgher, Co-Founder and CEO

Q: What is the time horizon?
A: The time horizon is the suggested period of time to hold the suggested stocks. When we calculate the forecast performance, we do so from the forecast date through the end of the time horizon.

Q: What do the colors indicate?
A: The green boxes signify long predictions and the red boxes signify short predictions. The bright shades denote the strongest predictions.

Q. How should I use the predictabilities and signals?
A. It is recommended that investors consider both the signal strength and predictability, as a highly predictable stock that barely moves and an unpredictable stock that is projected to move drastically both make unattractive investments.

Q. Which time horizons should I follow?
A. The longer-term forecasts (1-month and 3-month) tend to have higher predictabilities as the algorithm can more easily spot long-term trends. We suggest following these two time horizons the most closely, but the more reactionary shorter term horizons are helpful in understanding the short-term volatility of the market. Perhaps if you see that a stock with a strong, positive 3-month prediction has a negative short-term forecast, it is a good idea to wait until the stock decreases in value before buying it.