In 1986, Ivan Boesky was on top of the world.
A decade earlier, he launched his own investment firm with just $700,000 in seed capital… Then he used a special strategy to earn consistent, safe gains.
The plan was simple: Boesky would find companies likely to be bought out… take a large position… then cash out the gains if a buyout materialized.
By ’86, he had amassed a $200 million fortune and graced the December cover of Time magazine.
But as his fame and fortune grew, Boesky began straying from solid research and analysis.
Instead, he turned to inside information from the folks working on buyout deals. Then, he would take large, brazen positions – sometimes days before a buyout closed.
This method was lucrative, no doubt… But it was also a clear violation of insider trading laws.
Boesky was arrested and sentenced to 3½ years in prison… and charged a massive $100 million fine.
The sad thing is, had Boesky stuck to his original strategy, he could’ve milked the stock market for gains to this day… just like many of our subscribers have done.
That’s because we have access to the strategy Boesky used before he started cutting corners. And we don’t need insider information to find the most promising setups.
All we need to do is stick to our research.
It’s a trading strategy that gives us stakes in strong companies after they announce a buyout. Then, we simply hold our shares until the check clears.
In fact, we’ve used this method to bank gains like 9.9% on Red Hat in half a year, 24% on Celgene in 10 months, and even a gain of 21% in a little less than a month in the face of Brexit uncertainty (more on that last one below).
By comparison, the annual average return of the S&P 500 is about 10%. So we safely outperformed that in less time.
Today, I’ll show you how this strategy works. Plus, I’ll share a way to turbocharge your safe income even more without putting your current lifestyle at risk.
A Low-Risk/High-Reward Setup
As a shareholder, there’s nothing better than a good, old-fashioned bidding war over a stock you own.
Think about it… As bidders one-up each other, shares of the company you own rise higher. You can sit back and reap the benefits without lifting a finger.
Wall Street has used buyout announcements to rake in billions in profits for decades. That’s one of its favorite low-risk/high-reward setups.
It’s also one of the hedge-fund-type strategies Daily editor Teeka Tiwari and I use to generate thick income streams. We call them “Skim Trades.”
With these trades, we analyze major buyout deals as they’re announced. And when we find a deal we like… we recommend the targeted company’s stock. Then you sit back and capture the difference between the market and buyout prices.
Let me give you an example of how powerful this strategy can be…
In March 2020, Teeka recommended multinational insurance broker Willis Towers as a play on the Brexit saga and its corresponding rise in volatility.
He foresaw that Brexit uncertainty would cause well-run, elite British firms to trade at bargain valuations. Since these firms do most of their business outside the U.K., they’d be able to continue functioning as usual once the dust settled.
But there was one thing he couldn’t predict…
The coronavirus-induced massive sell-off in global stocks made companies with even solid buyout offers drop in price. And this handed him the opportunity to strike on Willis Towers.
Thanks to the combined volatility of Brexit and the coronavirus… shares fell as low as $148. That’s despite insurance brokerage giant Aon making a binding buyout offer of $232 per share.
He told readers to enter a position at $164 per share. And to exit at $197. That banked $33 per share in less than a month.
For a low-risk trade, a 20% gain in less than 30 days is a fantastic return. But the next strategy is where your wealth can really take off…
The One-Two Punch to Riches
If you want broad exposure to the strategy I just described, consider the IQ Merger Arbitrage ETF (MNA). This exchange-traded fund (ETF) uses a systematic approach to investing in buyout deals.
It also has the longest track record and one of the largest asset bases of any merger-related ETF in the marketplace.
MNA comes with a juicy 2.4% yield. So you won’t have to cut corners like Ivan Boesky did to get in on merger deals.
But if you want to take your income to the next level… consider what we call “No-Money-Down Alpha Trades.”
Our Alpha Trades involve options… and I know when you see the word “options” you probably think risk. But we use them in a much safer way than most people.
First, we sell put options on great companies to generate income. Then we use a portion of that money to buy call options on the same companies to bet on their upside.
We call these trades “No-Money-Down” since we don’t have to spend any money out of pocket. In effect, we’re using the money another trader paid us to get exposure to huge upside potential.
We’ve made gains as high as 380% on National Grid, 422% on CVS, and 612% on Jeffries Financial using this strategy.
Here’s the thing…
These trades really take off during periods of market volatility that Teeka calls “Anomalies.” During these Anomaly Windows, blue-chip companies can potentially produce decades of S&P 500 returns in just three months.
It’s all thanks to Fed-induced market volatility… and while it may be enough to send some investors rushing for the exits… you can use it to collect the money they’re leaving behind.
To learn more about our Alpha Trades… and how our subscribers have used them to pull in 17 years of market gains in just 55 days… click here.
You’ll even get a free list of stocks to help you get started.
Remember… you don’t always need a lot to make a lot in the markets.
Our No-Money-Down Alpha Trades let you use money another trader paid you to bet on the price of a company rising higher.
It doesn’t get any better than that.
Best Wishes,
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Nilus Mattive
Analyst, Palm Beach Daily