Founder Ken Berman launched Gorilla Trades while working full-time as a stockbroker on Wall Street. Like most founders, he wasnā€™t sure the business could develop trust with investors, hedge funds or institutions. Since then, his investing system has identified countless winners, with thousands of subscribers in past two decades.

In this interview, Berman shares his journey with Gorilla Trades and some thoughts about the current market.

When did you find a passion for investing and trading?

I learned about the market at an early age when my middle school ran a stock-picking contest. Each student selected two assets and tracked the performance for six to eight weeks. My picks of Polaroid and Disney (DIS) won me the contest and jump-started my interest in investing. I would call my fatherā€™s stockbroker each afternoon to track individual stocksā€”at that time the closing bell was at 4:30 PM and the newspaper was the only way to monitor performance. From there I got to know the ins and outs of investing.

ken-berman

What triggered you to start Gorilla Trades?

In the late 90s, I was a stockbroker for Smith Barneyā€”now a division of Morgan Stanleyā€” when I developed the initial algorithm for the Gorilla Trades platform. It could identify stocks primed to breakout using a blend of 14 technical indicators. Yet the brokerage firm appeared uninterested in what I developed. During that time, online brokerages like TD Ameritrade (AMTD) and E-Trade (ETFC) were also starting to gain traction, giving investors access to low-cost solutions in the market. It was a perfect storm of events that let me branch off on my own.

What were some early challenges of getting Gorilla Trades off the ground?

Trust is foundational to nearly every part of building a new company. It takes time, resources, and effort to create a following that leads to growth. In investing, trust surfaces from performance. I needed to prove my algorithm consistently identified stocks in an uptrend or prepared to breakout. I started offering the service for free to build brand awareness, but early subscribers knew they would soon need to pay.

At the same time, most of my advertising efforts centered on message boards because Twitter (TWTR), Facebook (FB), and Google (GOOGL), to some extent, werenā€™t available. It took several years and a larger advertising budget for Gorilla Trades to become what it is today. Now users pay $499 per year for access to daily stock picks, risk management tools and comments on prevailing market conditions ā€” a fraction of what they would spend on most independent research.

Can you speak to the nuts and bolts of the algorithm?

Itā€™s based entirely on technical parameters consisting of leading and lagging indicators. Some of that includes oscillators like relative strength, momentum indicators including the moving average convergence divergence (MACD), simple moving averages, volume, and velocity, among many more. Each factor is weighted differently to detect even the slightest change in a trend. For example, volume and velocity play a bigger role in the process than say a simple moving average. While the model employs technical indicators, we incorporate market capitalization to weed out small and illiquid stocks.

What do subscribers receive for signing up?

Every evening we run the algorithm to find stocks set to jump a leg higher in the near future. Users receive a list of long positions in individual names but also specific metrics to manage risk and reward like stop loss levels, a risk grade from 1 to 5, and entry points. Itā€™s meant to help investors find harmony in their long-term investment strategies. But it doesn’t end there. We hold subscriberā€™s hands the entire way, raising both stop loss levels and price targets as stock returns appreciate over time. Recommendations are typically held several months but often extends to multiple years if the long-term uptrend stays intact. Biotech company Abiomed (ABMD) was first recommended to subscribers in May 2017 when shares traded at $140 and remained on our daily screen for more than a year and 200% increase.

How much of your investment process is balancing emotion and process?

I learned early in life hunches and gut feelings donā€™t work. When I was a stockbroker, it bothered me when seemingly normal, rational individuals made extremely biased investment decisions based on greed and fear. For this reason, I designed the entire Gorilla Trades system to manage risk and remove emotion from investingā€” the major reason investors lose money.

Do you think the recent wave of volatility invites a shift back to active management?

Thereā€™s a common misconception that buying and holding an index fund can remove risk from the equation. Sure, the S&P 500 generates about 8% annual returns but it also experiences a fair share of ups and downs. A major pullback ā€” like the 2008 Recessionā€” has the potential to cut the market in half and leave investors strapped for capital. Amid higher volatility, active managers are better equipped to navigate tougher conditions, seek bargains, and avoid names with greater risk. During the Financial Crisis, for instance, Gorilla Trades recommended a handful of profitable short and long positions that combined outperformed most major indexes.

What is the main reason you feel the average investor has a difficult time generating consistent results with stocks?

Part of my answer goes back to your earlier question. In my experience, the number one thing holding most investors back from generating consistent returns is emotion. I have seen it time and time again during my more than 30 years of investing in the market. And despite what you may think, itā€™s not just the ā€œnewbiesā€ that tend to make this mistake. Iā€™ve seen serious investors with years of experience make silly mistakes time and time again, because they either went with their gut, or never had a plan to begin with. Which brings me to the number two reason most investors have a difficult time generating consistent returns; not having a plan, or not sticking to their plan. One of the worst things you can do when investing is open a new position without a game planā€¦ It very rarely works in your favor. Thatā€™s why I always reiterate the importance of having a plan to my subscribers. No matter what stock youā€™re buying, before you even consider hitting the ā€œbuyā€ button, youā€™d better have a firm grasp on exactly how much of a loss youā€™re willing to take, and how much of a profit youā€™d like to make. Is this a short-term trade, or a long-term ā€œbuy and holdā€ position? These things are very important when it comes to investing, and can make a world a difference in your overall returns.

Are there any other common pitfalls you see among traders and investors?

And itā€™s equally as bad when I see someone who has a plan, but canā€™t stick to it! Whether the trade is going against you, or in your favor, the biggest mistake you can make is to stray from that plan! Afterall, you put the time and effort into coming up with the plan in the first place. It is very common to hear someone say ā€œstock XYZ started dropping like a rock as soon as I bought it, but it has to come back at some point, so Iā€™m just going to hold it for now.ā€ So, rather than taking a small loss, you now have the potential to lose your ENTIRE investment on the chance that this stock could possibly return to the price you bought it at, at some point in the future? Thatā€™s too much risk for me. I like to keep my losses generally somewhere between 8%-10%, and when the stock breaches that level, Iā€™m OUT, regardless of the story, or my feelings about where it could goā€¦ If it breaches my stop loss level, Iā€™m cutting my losses and getting out before that loss becomes catastrophic.

Conversely, Iā€™ll often hear an investor say that they have a stock that is holding a profit, but they donā€™t know what to do with it. Should they sell some of it, part of it, or let it ride and hope that it just keeps going and higher? Again, this is the value of having a plan, because had they identified an objective at the very beginning, they wouldnā€™t be in this predicament. At Gorilla Trades, we recommend that our subscribers sell a portion of each investment once it reaches its ā€œfirst targetā€ to take some cash off the table and give them the opportunity to invest it elsewhere. At Gorilla Trades, that first target is generally somewhere between 8%-10%, but it could be higher or lower based on the risk profile of the stock. In any case, every recommendation includes a strict plan, and we always stress the importance of adhering to that plan. One common scenario Iā€™ve seen time and time again in this situation is when someone has a stock that is holding an unrealized gain, but rather than sell a portion at a predetermined point, they hold the entire positionā€¦ And then when the stock goes down, it wipes out all of their potential gains, and now theyā€™re like the first example I provided earlier, ā€œhopingā€ the stock comes back so they can sell it and get their money back. Moral of the story: regardless if you join Gorilla Trades or not, you NEED a game plan, your success is absolutely dependent on it.

What kind of stop loss do you feel offers investors the best chance at success?

This where things can get a little tricky. You see, Iā€™m not a financial advisor, and I no longer hold the licenses from my broker days, so I canā€™t provide any kind of individual advice. Frankly, my advice canā€™t be just geared toward what would work for one person, or in one particular scenario, it has to work for ALL of my subscribers, and in every kind of scenario. And the fact of the matter is, when it comes to choosing a particular order type, there are many factors that must be accounted for. For example, two of the most common types of stop losses are the ā€œlimit orderā€ and the ā€œmarket order.ā€ They may sound somewhat similar, but they are very different in terms of how they are actually executed. With a ā€œlimit order,ā€ you generally select a price, and once the stock trades at the particular price, the stop loss will trigger, and the stock will be sold. So, letā€™s say you put a limit order of $99 on stock XYZ. The minute that stock XYZ trades at or below $99, your stop loss is immediately triggered, and the stock is sold. On the other hand, with a market order, you order will be executed at whatever price the stock is currently trading at. So, using these two as examples, the limit order offers you a more precise exit, while the market order may offer a more immediate exit because it is not focused on a particular price area. There are many more kinds of stop losses too, and you could make a case as to why each one may be more applicable in a certain situation. Additionally, all brokerage operates a little differently, which is why I always recommend that my subscribers contact their broker directly to see what they recommend.

Ok, that makes sense. When you are investing personally, do you have a particular type of order you like to use, or you use more frequently than others?

In addition to the kinds of stop losses I mentioned earlier, which again, can each have their own applications- the one kind of stop loss I personally use most frequently would be ā€œtrailing stop.ā€ I tend to use it most often with positions that hold an unrealized gain, but the thing I like most about the trailing stop is its versatility. Trailing stops continually adjust the stop area based upon fluctuations in the market price of a stock, while always maintaining the same percentage below the market price. This pre-established percentage of the current price is used to determine the amount of trade draw-down desired. The price percentage selected is for initiation purposes only, but remains constant as a trade progresses; the stop-order trails the stockā€™s price performance, but eliminates slippage through a pre-determined drawdown percentage. Therefore, if the trade continues to progress higher, without ever breaking below the established percentage, the trade may hypothetically be held forever! Letā€™s say, for example, stock XYZ is trading at $100 per share, and you donā€™t want to risk more than 10% at any given time. With the use of a trailing stop, you could simply set your stop loss at 10% (rather than selecting a specific price point) and as the stock trades higher, the trailing stop will automatically move higher with it. So, letā€™s say the stock eventually reaches a high of $130, your 10% trailing stop loss will now be based on that $130 figure, and as long as the stock never trades 10% below its trading price, you could hypothetically hold the stock forever as it progresses higher! Itā€™s a great way to preserve your gains, while also keeping your risk in check, which is why it tends to be my go-to. But again, your situation may be different, and another kind of stop loss may be more of what youā€™re looking for. So, talk to your broker and see what they think before assigning any kind of stop loss to your position(s).

There seems to have been a huge shift toward options trading in recent years. What are your thoughts on this shift, and how do you think it will impact individual investors?

Great question! Options have been around for a while, but they really seem to have caught the attention of the average investor in recent years, which is both good and bad. My views on options are somewhat mixedā€¦ You see, for the experienced investor, options can be a great tool to gain more leverage with your existing capital. However, even though they can be a great tool for experienced investors, it is all too common to hear about novice investors getting burned! You can really end up going down a rabbit hole when it comes to learning about options, as there are probably more strategies out there than we could even cover in this interview! But for the sake of an example, we will just use straight calls. So, letā€™s say for example, that stock XYZ is trading at $500 per share. The average investor may look at that and decide that the price is simply too rich for their portfolio, which, in some scenarios, may be reasonable. However, that same stock may have call options available for a fraction of the cost, letā€™s say $100. And that $100 will allow you to effectively ā€œcontrolā€ 100 shares of stock XYZ (which, remember, is currently trading at $500 per share!), so you would be controlling approximately $50,000 worth of shares for only $100, which may seem like a steal! Now, the allure for options is when the stock moves 5%-10%, the price of the options could move 50%-100%; seems easy, right? But what about when the trade goes the other way? That same price movement is reflected to the downside! So, if a stock moves down 5%-10%, the price of the calls may drop by 50%-100%! Now it doesnā€™t seem quite as appetizing, does it? While many services out there recommend the use of options to all investors, I really stress the fact that my options recommendations should only be used by experienced and aggressive traders, because again, while they can be great for certain investors, they can also be detrimental for others. So, regardless of which service you use, or which approach you are choosing to take with options, I cannot stress the importance of truly understanding them before making any trades. It is far too common, and far too disappointing to hear all of the horror stories from novice investors who get burned trading options, which can often wipe out their entire portfolio! Educate yourself on options and the inherent risk involved before risking a single dollar; you will thank me later!

I understand you are a bit of a technical wizard when it comes to stocks, but for the average joe, learning all of the terms and chart patterns within technical trading may seem to be too daunting of a task. For those interested in incorporating charts or technical aspects into their trading, can you recommend a general starting point?

You are correct; to truly understand the intricacies of technical trading could take years, if not decades, and it seems as though you are never really done learning! Things like volume, velocity, relative strength, and MACD are probably some of the most common terms youā€™ll see thrown around when it comes to discussing technical trading. And then when it comes to formations, youā€™ll often hear terms like ā€œcup and handle,ā€ ā€œhead and shoulders,ā€ ā€œascending/descending triangles,ā€ just to name a few! But for the average investor just looking to incorporate a hint of technicals into their trading, the simplest starting point I can suggest would be the 50-day and 200-day moving averages. To put it simply, the 200-day moving average is what is commonly referred to as the ā€œlong-term moving average,ā€ while the 50-day moving average is commonly referred to as the ā€œshort-term moving average.ā€ If you are trying to get a pulse on the broader market, you can generally just look at the major indices to see where they are trading at. For example, if you notice that the S&P 500, the Nasdaq, and the Dow (the three major U.S. indices) are all trading above both their 50-day and 200-day moving averages, that would generally be considered a ā€œbullishā€ or positive signal. Conversely, if you notice that the S&P 500, the Nasdaq, and the Dow are all trading below both their 50-day and 200-day moving averages, that would generally be considered a ā€œbearishā€ or negative signal. The same is true for individual stocks as well. And if youā€™re thinking ā€œhow the heck do I find out what these moving averages are?ā€ donā€™t worry, there are numerous websites available that show this information for free. While I do believe that is a good general starting point for the average investor, I personally choose to delve much deeper into the technical aspects of trading, as I truly believe that technical trading offers the greatest chance of success when it comes to trading or investing. So much so, in fact, that my proprietary Gorilla Trades system focuses exclusively on 14 technical parameters that appear in stocks before they make explosive upward moves. It has been my secret to success over the last 20 years or so! Rather than forcing my subscribers to learn all of the complex technical patterns and terms, my system does the legwork for them, and we simply present the stocks that have the greatest chance of success each night. Itā€™s a true win-win, as it allows the average investor to enjoy the fruits of technical trading, without having to put in the years of dedication required to actually learn how to do it! So, if youā€™re interested reaping the benefits of technical trading, but donā€™t have the time to invest in actually learning it yourself, try giving Gorilla Trades a shot today!

Hi, I’m Ken Berman, Founder and CEO of GorillaTrades. I am going to personally answer a selected question from a subscriber each week…..Please feel free to email any questions you might have during the week to theGorilla@gorillatrades.com… and on to the this weekā€™s question….


A: No, there is no limit as to the number of stocks that can be held within the GorillaTrades portfolio at any given time. However, when the portfolio grows to hold a very large number of holdings, corrective market periods typically re-balance the portfolio as a result of stop levels, which are raised weekly as a GorillaPicks rise.

Since the GorillaTrades service provides a ā€œmenuā€ of new and existing stock ideas, with guidelines and tools to aid in achieving your desired goals, I direct subscribers to BUILD a portfolio; you are certainly not expected nor instructed to purchase every single GorillaPick. In fact, if you did, I would consider your portfolio VERY over-diversified!
When building your portfolioā€¦.whether your stock selections include new or existing GorillaPicksā€¦ the ideas are always organized and updated daily within the current portfolio on the website.

This allows you to monitor and evaluate new or existing GorillaPicks, while selecting individual points of entry and exit.

Keep in mind that the GorillaTrades portfolio is already inherently diverse (by price, sector, risk-rating and evenā€¦ market capitalization). Your only obligation is to spread capital according to your individual risk parameters. Whatever version of ā€œdiversificationā€ you exerciseā€¦ should always be set to reflect your individual tolerance for risk.
Most importantly, under no condition should you EVER over-commit capital to any ONE position. And, as always, assign an exit strategy to each and every trade!
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A: That is a great question, and one we receive oftenā€¦.First and foremost, please understand that all of the Option Ideas that are presented are meant for only our most aggressive subscribers.

I always like to remind our subscribersā€¦ especially those that are new to trading optionsā€¦ that in some cases, you may lose your entire investment!
Not only thatā€¦ but Option Idea of The Week is based on a debit spread, also known as a Vertical Call Spread. These orders can be somewhat complex when placing them yourself, and even the tiniest error can have a huge impact on your performance.

We have heard everything from our subscribers selling the wrong callā€¦ others have bought the wrong callā€¦ and plenty have just placed the order incorrectly all together.
For this reason, there is currently a limited amount of options education available on the GorillaTrades websiteā€¦ It is very important to first understand options and the inherent risk involved with each trade, before attempting to act on any of the recommendations.

For those that are experienced, and understand the risk involvedā€¦ it can be a fantastic strategy to boost your portfolioā€™s returns. However, I certainly would never want to encourage any of our less aggressive or novice investors to pursue such an aggressive strategy.

For additional details on how to place the orders as they are presented, I encourage you to contact your broker.
And when it comes to formal education on options, I only refer my subscribers to the CBOE. So, for more information on options in general, please visit: www.cboe.com.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A: Absolutely not!

There is no specific account size required in order to take advantage of the GorillaTrades offering.

In fact, GorillaTradesā€™ investing principles have proven to be effective for thousands of subscribers throughout the world, regardless of portfolio size.
You seeā€¦ on average there are approximately 3-5 GorillaPicks recommended each week.
Of those 3-5, not all of them do go on to actually trigger and/or confirm.
Some may never triggerā€¦ Others may trigger but never confirmā€¦
And of those that do, I do not recommend that any subscriber actually try to purchase each and every GorillaPick.
I instead recommend that each subscriber build their portfolio based on their available capitalā€¦ by never committing more than 5%-10% of their portfolio to any one positionā€¦ and their appetite for riskā€¦. by utilizing the risk rating feature, which goes on a scale of 1-5
I hope this answers your question, but if you happen to have any further questions, there are numerous educational materials and informational tutorials available to all subscribers that go over the GorillaTrades system in great detail within the Safari Guide section of the GorillaTrades website.


A: That is a great question, and is a common one we receive from new GorillaTrades subscribers.

I would like to stress that I do not expect any subscriber to purchase every GorillaPick that is recommended.
In factā€¦. Despite the fact that it would be incredibly difficult for one person to manageā€¦ If you were to do so, your portfolio would likely become so over-diversified, that you would capture little to no upside overall.
I instead recommend that each subscriber build their portfolio based on their available capitalā€¦ by never committing more than 5%-10% of their portfolio to any one positionā€¦ and their appetite for riskā€¦. by utilizing the risk rating feature, which goes on a scale of 1-5
Therefore, since every subscriber will likely be in a different financial positionā€¦ and will likely have a different appetite for riskā€¦every subscriber will ultimately have a slightly different experience as well as a portfolio made up of different stocks.
It is very doubtful that any two subscribers would have the same exact portfolio or same exact returns.
Thus, while we could easily skew GorillaTrades’ results to broadcast outlandish annualized returns like the majority of our competitorsā€¦we would rather remain honest and 100% transparent, by providing our subscribers with access to every GorillaTrades transactionā€¦.including every winner and every loser that has been recommended since 2003.
That said, if you are interested in analyzing GorillaTrades’ past performanceā€¦ please visit the Trading Post area of the GorillaTrades website and click on Closed GorillaPicks Transactions to download the Excel spreadsheet and calculate any returns you wish based upon your personal selection criteria.


A:Thatā€™s a great suggestionā€¦

Because the GorillaTrades service is entirely web based, our subscribers are scattered all throughout the United States and abroadā€¦
And prior to the last year or so, weā€™d never had any of our subscribers show a real interest in meeting up and getting to know some of their fellow subscribersā€¦
So, while this could certainly end up happening one dayā€¦ for now, Iā€™d recommend that any current paid subscribers that are interested in sharing ideas with other subscribers take advantage of the GorillaTrades forum.
This feature is the only feature those on trial do not have access to, as itā€™s available to paid subscribers only.
The GorillaTrades forum is a great way to share ideas in real-time, as you can ask questions about the service, or a particular recommendationā€¦. Many GorillaTrades subscribers are long-term subscribers with years of experience in the marketā€¦ many of which are quick to lend a helping hand, or share a potentially profitable idea
So, donā€™t be shyā€¦ If you have a question, ask itā€¦ And if you have a great idea for a trade and want to share itā€¦. Post it for your fellow subscribersā€¦ Who knows, they may reciprocate that generosity and share their next idea as wellā€¦.
In any case, if any current subscribers are interested in meeting up with their fellow subscribers in person, the forum may be a great starting point to put something together and meet up with your fellow subscribers in your area!


A:This is definitely one of the top questions Iā€™ve received over the yearsā€¦

And itā€™s understandableā€¦ Youā€™re pursuing my recommendations, without knowing the exact reasoning behind it.
In short, there are fourteen different strictly technical parameters that are involved in the proprietaryGorillaTrades screening process.
And while Iā€™ve disclosed many of the parameters involved to GorillaTrades subscribersā€¦ twelve of the fourteen to be exactā€¦ all fourteen the technical indicators have not been made public, as some of these technical parameters must be kept secret.

After all, this is what makes the GorillaTraes system uniqueā€¦ And itā€™s what allows us to find the stocks with the greatest potential to explode in price and present them to you.
Some of the parameters include MACD, which is a two-component indicator based on two exponential moving price averagesā€¦ Another is volume, which plays a major role in the GorillaTrades system, as itā€™s the force that drives the marketā€¦.
Moving averages, which help todepict the underlying trend is another. Although many different time periods are commonly used, 21 days is considered appropriate for short-term tradingā€¦ 50 days is used for intermediate-term tradingā€¦.And for long-term trend analysis, most analysts prefer a 200-day averageā€¦ while the GorillaTradesā€™ indicator is a combination of all three periods.
These are just a few of the parameters involved in the screening process, but much like Dr. Pepperā€™s, Coca-Colaā€™s, or even KFCā€™s proprietary forumla..GorillaTrades true secret sauce is reserved for my eyes only.
That said, if youā€™d like to learn more about the disclosed parameters of the GorillaTrades system, simply head to the Safari Guide section of the GorillaTrades website and click on Technical Parameters to read more.


A:Gorilla Picklets and Special Situation Picks are only intended to be “bonuses” to the overall GorillaTrades system.

Gorilla Picklets are stocks that are priced at or less than $5 per share, and also have less than a billion-dollar market capā€¦ which is a staple for standard GorillaPicks.
Special Situation Picks are stocks that appear on the Gorilla’s radar screen which also donā€™t meet the standard market cap requirements of one billion dollarsā€¦ However, these stocks can have varying prices.

Gorilla Picklets and Special situation picks are merely bonuses to the GorillaTrades system, and are not the main focus of the service.
These ideas are intended to fulfill the needs of aggressive subscribers who may be seeking higher risk, and thirsting for potentially higher returns.
And on average, only 5-10 Picklets are presented each year, along with roughly the same amount of special situation picks.
So while they are a great bonus to the subscription, they do not appear as often as our flagship GorillaPicksā€¦ which are higher priced, large-cap stocks.

And unlike Gorilla Picks, these bonus picks ARE NOT accompanied with any guidance, and ARE NOT monitored within the current portfolio. In addition, the market cap and trading volume of these stocks can sometimes be VERY low, and can be extremely volatile.
These picks are meant to have longer-term holding periodsā€¦several months in most casesā€¦ and have the MOST aggressive Risk Rating.
With that said, unfortunately, these stocks are just too volatile and illiquid to provide any type of guidance like what is included with each GorillaPick.
So, I do recommend the use of these stocks for our more aggressive subscribersā€¦ but it is not recommended that you attempt build your entire portfolio around these stocks, due to their volatility… They should be viewed strictly as bonuses.


A: Iā€™ve attempted to do just this for the last 20 yearsā€¦. and I havenā€™t yet found a fair way to present the results that would please EVERYONE.

You seeā€¦ on average, we could have anywhere around 200 different potential GorillaPicks appear on the GorillaTrades radar screen each year.
It would be nearly impossible for any subscriber to purchase every GorillaPick presented… And, even if you could buy them all, your account would be extremely over-diversified.

Itā€™s important to reiterate that I donā€™t expect or encourage any subscriber to purchase every GorillaPickthat ā€˜s recommended… Instead, I recommend that each subscriber build their portfolio based upon their available capitalā€¦ by never committing more than 5%-10% of your overall portfolio to any one positionā€¦ and appetite for riskā€¦ which is on a scale of 1 to 5.
Because of this, and the fact many subscribers will join the service in varying time framesā€¦ every subscriber will ultimately end up having a different experience and a different portfolio.
Itā€™s highly unlikely that any two subscribers would have the same exact portfolio or the exact same returns.

Weā€™ve all seen the outlandish results quoted by other services, claiming to beat the S&P 500 by 500% over the last 5 yearsā€¦. And so onā€¦
And while we could easily do the same, we would rather be up front with our subscribersā€¦ and provide them with access to every single GorillaTrades transactionā€¦ including every winning trade AND losing trade made since 2003. There arenā€™t many other investment newsletters out there that can say the sameā€¦

I always encourage any subscribers who may be interested in analyzing GorillaTradesā€™s results to do soā€¦ especially if youā€™re new to the service and it will help to build your confidence in our recommendations

This spreadsheet is readily available to all current GorillaTradessubscribers, whether youā€™re on trial, or youā€™re a paid subscriberā€¦
If youā€™d like to review the results for yourself, simply head to the trading post area of the GorillaTrades website and click on closed GorillaPicks transactions to download the Excel spreadsheet and calculate any returns you wish based upon your personal selection criteria.


A:This is a fairly common question we tend to receive from new subscribers whoare just getting familiar with the jungle.
For those of you who may be thinking the same, please note that the GorillaTrades portfolio is updated with raised second targets and stop losses on Monday evenings ONLYā€¦.and a link to these adjustments is included in the Monday evening email, which directs subscribers to view the updated portfolio.
You may also login to the GorillaTrades website to view the GorillaTrades portfolio weeklyā€¦ any Mondayevening that the stock market is open, to see stop level (shaded green) and second target (shaded orange) raises.
I do not raise price targets or stop losses of current GorillaPicks during the week.
From time to time, there will be occasions in which a GorillaPick will rise substantially during the week, and will receive a very rare emergency second target raiseā€¦. But again, it is worth noting that these are generally very rare, and do not occur on any kind of regular basis.
Andā€¦ anytime there is an emergency second target raise, it will be clearly noted in the nightly email.
Many subscribers just get in the habit of visiting the GorillaTrades website each Monday evening and downloading the current GorillaTrades portfolio to review any of their personal holdings that may have received a target and/or stop loss raise.
You can also just keep an out for the nightly email, which will again, include a link to the portfolio within it. You may also view any changes made to the GorillaTrades portfolio in the GorillaTrades mobile app as well
Whichever approach you pursue, it should take no more than a few minutes each weekā€¦ and itā€™s a good way to stay on top of any recommended changes within the portfolio.


A: This is a great question. Personally, I am a big believer in diversification, and no matter your approach, I believe it can be very beneficial to your investing in the long run.
Since the GorillaTrades portfolio is already inherently diverseā€¦ by sectors and market capitalization alikeā€¦ your goal should be to spread capital according to your individual tolerance for risk.
The number one way I recommend that subscribers diversify their GorillaPicks is by Risk Rating… If you would like to diversifyfurther based on industry/sector etc., you can do this as well, but this is a decision you will ultimately have to make on your ownā€¦. And again, please keep in mind that the GorillaTrades portfolio is already generally diverse, in terms of sectors and/or industries.
Diversifying GorillaPicks by their respective Risk Ratings will drastically reduce the volatility of your overall portfolioā€¦. As whenever the market experiences corrections or steep declines, stocks having a risk rating of three or less will generally maintain a more stable composure than higher risk-rated stocks.
Soā€¦ whether your selections include new or existing GorillaPicks, the ideas are organized and updated daily within the current portfolio… And every single GorillaPick is accompanied with a risk rating, which is included within the portfolio as well.
I wholeheartedly believe that as you build your portfolio, the inclusion of diversification is absolutely essential to your success in the market… Given that these tactics are often used for portfolio protection, they may ultimately improve your total performance.
Whether you follow GorillaTradesā€™ exact approach to trading or you create your own individual adapted style, the key is to keep your risk and losses to a minimumā€¦ Remember, the excel version of the portfolio is completely interactive, accommodating any adjustments to determine individual entry or exit levels.


A:Thatā€™s a great question, as the Return-To-Risk Ratio is one of the most highly recommended tools available to GorillaTrades subscribers.
In order to utilize this tool, please open the current GorillaTrades portfolio, in excel format, and scroll all the way to the rightā€¦ The Return-To-Risk ratio, or RTR column is at the far-right end of the spreadsheet.
You can also find the current figures listed for each GorillaPick in the web version of the portfolio tooā€¦ However, you can only edit the excel version.
Soā€¦. If youā€™re looking to make any changes to the portfolioā€¦ Like managing an existing position, or possibly identifying entry points in new positions, youā€™d more than likely want to utilize the excel version of the portfolio.
That said, the figure in the RTR column is simply a ā€œgaugeā€ of how much projected return potential is possible from each GorillaPick’s current price.
For example, a figure of three would demonstrate a three-to-one ratio of potential return versus possible risk.
This figure, which is calculated daily using the latest prices for each GorillaPick, enables subscribers to quickly sift through the current portfolio and identify out-performing or under-performing GorillaPicks.
I generally recommend that subscribers seek out GorillaPicks in the two to five range, as I have found that to be the ā€œsweet spot.ā€
A larger RTR figure will usually identify a GorillaPick that has been on a recent pullback or declineā€¦ and may be near its recommended stop level, but may also reward investors with big returns… When reviewing trading ideas, the higher the RTR, the greater the risk that a GorillaPick may stop outā€¦ but the losses incurred will be small in relation to the potential rewardsā€¦ ā€œthe higher the risk, the greater the potential returnā€.
A smaller RTR figure will usually identifya GorillaPick that has been on a strong advance, and the current price is now closer to its projected second target than it is to its suggested stop loss levelā€¦. The smaller the number, the less risk there is that a GorillaPick will stop out from its current recommended stop loss levelā€¦ but the loss incurred may be larger in relation to the potential reward.
The RTR feature is a fantastic tool that you can use to find GorillaPicks that are currently within the ideal two to five range… It can also be used to tweak individual entries, or stop loss figures, in order to achieve an ideal RTR figureā€¦ For more information on this tool, please head to the Safari Guide section of the GorillaTrades website and click on Return-To-Risk Ratio.


A:At the time of this filming, itā€™s been quite a while since weā€™ve experienced a true bear market… Although, as many long-term subscribers know, if the market were to take a definitive turn into bear market territory, the only major change you would notice would be the amount of GorillaShorts recommended, in order to help our subscribers capitalize on any distressed stocks.
You would not have seen many GorillaShorts recommended lately, because we have been in a bull market… I am a big believer in the infamous axiom ofā€¦the trend is your friend. And I donā€™t believe it would be in my subscribersā€™ best interest to go against tide and recommend shorts in a bull market.
ā€¦It is worth noting, though, that the GorillaTrades system has proven to be effective in any market conditionā€¦Even in a bear market, the GorillaTrades system is still able to identify stocks with explosive potential that defy the overall trend… Afterall,itā€™s one of the unique characteristics of thesystem.
We only apply short recommendations on companies that may have the potential for technical problems, and may have a high probability for a decline in price versus the amount of potential risk taken.
And since shorts are one of the mostā€¦ if not the mostā€¦ risky investment, we want to ensure thatwe are able to do the full analysis required in order to recommend shorts with the highest likelihood of success.
Therefore, once a GorillaShort with a high enough probability of success has been identified, it will most certainly be recommended to subscribers.
And for those who may be interested in pursuing these strategies, but would like to avoid shorting a stock, please also keep in mind that while we may not offer a strategy exclusively focused on puts, many aggressive investors will choose to utilize puts rather than shorting a stock.
In any case, Iā€™d like to remind those who have been with us for years, as well as those who may be new to the jungle that GorillaTrades has been around since 1999. The next bear market wonā€™t be the first we have experienced, and it likely wonā€™t be the last either. And whether in an up, down, or sideways marketā€¦ we will always do our absolute best to provide you with the tools you need to be successful.


A: I understand that it can sometimes seem a bit overwhelming to decide exactly which GorillaPicks to pursueā€¦ especially for those that are relatively new to the jungle. And while I donā€™t want to beat a dead horse hereā€¦ I do just want to point out again that I donā€™t expect, or recommend, that any subscriber actually attempt to purchase every single GorillaPickā€¦ It would be far too much for any one person to manage, and your portfolio would become so over-diversified that you would capture limited to no upside.
That said, in addition to the excel version of the portfolio being completely interactive and allowing you to view and edit it any way youā€™d likeā€¦ we also recently introduced the portfolio search feature.
This feature is great, especially for those who may not be as tech-savvyā€¦. as it is really easy to use, and will help you to quickly find the current GorillaPicks that meet your personal objectives or tolerance for risk.
To find this feature, simply head to the Trading Post area of the GorillaTrades website, and click on GorillaTrades portfolio search.
Once you do that, the portfolio search feature will populate with four options for you to choose from: risk level, volume, price, and return-to-risk ratio, or RTR. All four of these options allow you to select high, medium, low, or any.
The only recommendation I have, is that you select ā€œmediumā€ for the return-to-risk ratio, or RTR optionā€¦ And the reason for this is because I have found that the sweet spot for this number is generally between two and five, and by selecting medium, it will focus on stocks in this range only.
All of the other parameters should be selected according to your personal parameters. For exampleā€¦. If you were looking for lower priced stocks that trade on high volume, I would select any for risk levelā€¦ high for volume levelā€¦. Low for price levelā€¦. And medium for return-to-risk ratio.
Since the portfolio is already inherently diverseā€¦ by sector and market capitalization alikeā€¦ your focus should be on spreading capital according to your individual tolerance for riskā€¦ Which is why I always recommend that subscribers diversify according to each GorillaPickā€™s risk rating. This is the number one way to use this feature, but as you can see, it is really great feature overallā€¦ and will allow you to get as specific as youā€™d like in terms of price and volume as well.


A:One of the main reasons I encourage dollar cost averaging UP over dollar cost averaging DOWN is because I recommend that our subscribers buy on strength, not on weakness.
Dollar cost averaging up allows you to purchase shares of the same stock at successively higher prices in order to achieve a larger position, at an average price that is lower than the current market valueā€¦ It is a great way to capitalize on a performer.
So, even though you may be buying the same stock for higher and higher prices than your original purchase, your overall average cost per share will be lower than what the stock is currently trading at.
And this allows you to invest in the same stock, without having to commit as much capital at the beginningā€¦. Essentially allowing you to capitalize on a strong stock, without betting big right up front. This way, if the position doesnā€™t go your way, you can be wrongā€¦without it having as much of an impact on your overall portfolio.
The strategy is pretty simpleā€¦. as the stock matures within the portfolio, watch its price behavior relative to the current portfolio and the overall marketā€¦ as a strengthening stock generally exhibits a positive stance, regardless of the market’s action.
Then, as the GorillaPick progresses higher, consider adding to your existing position.
There are many different ways to go about this strategyā€¦ You could do things like buy 50% of your total planned investmentfor your initial purchaseā€¦ Then your next purchase could be 30% of your total planned investmentā€¦ And then your last purchase would be for the remaining 20% of your total planned investment.
These numbers can obviously be tweaked to each subscriberā€™s individual strategy, or appetite for risk, but this is the general framework behind the strategy.
ā€¦Also, remember that as you begin to free up some capital, it may make more sense to invest more in some of your top performers, rather than always seeking out new positionsā€¦ And if that is your goal, dollar cost averaging up is a great way to do so, and it removes the word hope from the equationā€¦ which is what you are doing when buying a stock as it goes downā€¦ Youā€™re hoping that it stops dropping and goes back up soon.
When it comes to investing in any stock, I believe that you should always consider dollar cost averaging up, as in my experience, it is simply the most effective way to invest.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A:When a new GorillaPick is introduced in the nightly email, you have a few options, in terms of how you choose to use the information presentedā€¦. but here is the general framework for you.
Letā€™s say, for example, in the latest nightly email, you see stock XYZ is recommended for purchaseā€¦ One of the main reasons we send out the newsletter in the evening, is so that our subscribers have the time to review the information presented, and decide if it is a stock they would like to pursueā€¦. This also allows you to do any additional due diligence deemed necessary, so that you are ready to execute the following morning.
Now, letā€™s say that you like stock XYZ and youā€™ve decided youā€™d like to purchase the stockā€¦. Each GorillaPick includes a recommended trigger price, profit targets, a stop loss, risk rating, and a confirmation volume level.
We have covered the confirmation day process at length, and you can find these tutorials within the Safari Guide section of the GorillaTrades website… However, the simplest breakdown of this concept is as followsā€¦ Letā€™s say stock XYZ has a recommended trigger price of $100ā€¦. If you consider yourself to be an aggressive investor, you would buy stock XYZ as soon as the stock trades above the recommended $100 trigger price.
Converselyā€¦ if you consider yourself to be a less aggressive investor, you would want to wait for the stock to confirm before purchasing. In order to initially confirm, a triggered GorillaPick must close higher than its previous close AND higher than where it openedā€¦ It must also close higher than its trigger priceā€¦ And it must also meet or exceed its specific confirmation volume level.
I understand this may sound like a lot of information to manage, but donā€™t worry, we do not expect our subscribers to track these parametersā€¦ We track them all for you, and make note in the nightly email. Because we must account for the closing price and closing volume, we list all confirmations in the nightly email only.
So, if you were a less aggressive investor and wanted to wait for confirmation, you would be notified of stock XYZā€™s confirmation status in the nightly email, and then simply place your buy order the following day, or some time after that, depending on your approach.
Thatā€™s really all there is to itā€¦ We supply you with everything you need in order to take advantage of each recommendation, and there is no guesswork involved.
So, to recapā€¦ You are notified of a new potential GorillaPick in the nightly emailā€¦. You do any additional due diligence you deem necessary before the next market dayā€¦ You then buy as soon as a stock triggers if you are an aggressive investorā€¦ or you wait to purchase until you are notified that the GorillaPick has confirmed if you are a less aggressive investor. Thatā€™s it!
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A:Our research on the fruition rates ofGorillaPicksin regards to their respective risk ratings has shown conclusive evidence of a relationship with trade volatilityā€¦ not performance.
You see, when the market experiences a correction or steep decline, those GorillaPicks that have a risk rating of three or less will generally maintain a more stable composure than higher riskrated GorillaPicks.
Therefore, when determining potential entry or exit points on new or existing positions, I recommend that you consider each GorillaPickā€™s risk rating before entering or exiting any trades.
The risk rating is based on a combination of share related items, including a stockā€™s market capitalization, shares outstanding, volatility and current tradable float, and it serves as a kind of snapshot of impending volatility at the time the stock was released.
While this trading behavior may be the result of many different factors, you can always count on the volatility being accounted for within the stockā€™s risk rating.
In short, the only concrete relationship that exists between current GorillaPicks and their respective risk ratings is volatilityā€¦
So, for example, a two risk rated stock will generally have the exact same chance of achieving its targets as a five risk rated stockā€¦ The only really difference is the path to achieving its profit goals, as you can generally expect a more bumpy ride with the five risk rated stocks, in comparison with the two risk rated stocks.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A:The Weekly Strongest List is merely an announcement of strength in comparison with the overall market during the prior trading weekā€¦
That means that the GorillaPicks listed have experienced recent performance aligned with, or beyond, their respective broader market averagesā€¦. Therefore, regardless of any potential volatility, or turbulent market behavior, the GorillaPicks on this list continue to show strong demand.
There may be some weeks when there are many GorillaPicks on this list, and there may also be times when there are very few, or even none listed at all.
In any case, I believe that this list is extremely valuable, as it identifies consistent accumulation during any type of market environment.
So, if you were considering starting a position or adding to an existing position of a GorillaPick that is listed in the Weekly Strongest list, this list is intended to either add confidence to your decision makingā€¦. as these stocks were the top performers of the prior week and may allow you to capitalize on a performerā€¦ or it may help to identify stocks that are due for a pullback as the stocks on this list rose the week before and some may be due for a pullback in price.
There are numerous ways to use this information each week, and I always encourage our subscribers to get creative when it comes to unique ways of using the information presented by GorillaTrades, but these are the two most common ways I recommend to use the Weekly Strongest list.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A:The GorillaTrades system was designed to accommodate all styles of trading, so while there may not be any current day trading, or shorter-term swing trading recommendations being made at this time, you may certainly use GorillaTradesā€™ recommendations within your own personal approach.
I have heard from countless subscribers over the years who have successfully used GorillaTradesā€™ recommendations for shorter-term tradesā€¦.
Whether or not you follow the GorillaTrades systemā€™s recommendations exactly, or you use another technique or style to trade, your success will always be achieved through the way you manage riskā€¦ The critical element to your performance is through trade managementā€¦ since risk is always present, and losses are inevitableā€¦ the key is to understand the value of losing small.
So, beware of a common trading pitfallā€¦ I do not advocate the practice of buying in one time frame and selling in anotherā€¦ daytrading or short-term trading time frames are completely different, and require separate rules, guidelines, and strategies to reduce or manage trade risk.
This is my only major concern, as the switching of time frames approach generally leads to the disregard of an exit strategyā€¦ which is the only protection you have against portfolio disasters. Therefore, if your strategy is to buy in one time frame and perhaps sell in another, make sure your exit strategy is set to matchā€¦.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A:Within the GorillaTradessystem, the difference between a price pullback and price weakness is the relationship between the current price and the original trigger priceā€¦
Just to reiterate, I do not advocate chasing stocks that are currently trading below their original trigger prices. Therefore, if a GorillaPick is trading below its original trigger priceā€¦ it would be considered potentially weakā€¦ especially if the GorllaPick has not yet confirmed.
The vast majority of GorillaPicks will in fact provide opportunities to enter on pullbacks, even after confirming… So, if you consider yourself to be a less aggressive investorā€¦ and you choose to wait for confirmation before purchasing, you may look for opportunities to purchase on a pullback, so that you are able to purchase closer to the original recommended trigger price.
But again, if a stock begins to trade below its recommended trigger priceā€¦ especially if it has yet to confirmā€¦ I would recommend avoiding that particular stock, until it has at least risen above its original recommended trigger price.
Even though it may seem like youā€™re buying at a discountā€¦ There is simply no way of knowing if the dip below its trigger price is something minor that it will quickly recover from, or if it is a sign of something potentially more severe, in which case the stock may ultimately stop out of the portfolio.
Therefore, if you have decided to wait for confirmationā€¦after being notified of a stock’s confirmed status, determine your desired point of entryā€¦ somewhere above the trigger price and assign an exit strategy according to your individual tolerance for risk.
Please also keep in mind that the GorillaTrades portfolio contains all of the information for each recommended GorillaPick for you to reference at any time, including its original recommended trigger price.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!


A:This is a great question, and a pretty common one among new GorillaTrades subscribers…
Whether there is an existing GorillaPick that has already hit its first target, or there is a GorillaPick that gaps up a couple of percentage points before confirmingā€¦ for our less aggressive investorsā€¦just know that you can still take action with these picks.
I typically suggest using the first target for diversification purposes only… This strategy is extremely helpful when capital is limited and spreading your portfolioā€™s positions presents a challenge…
However, if you wish to capitalize on a performer and pursue a GorillaPick that has already achieved its first target, you actually have quite a few different options, in terms of your approach.
First of all, if your account is properly diversified according to your personal risk parameters, one option for you would be to focus on the projected second target goalsā€¦ while adjusting your stop levels against your trade objectives each week.
A second option would be to simply wait for a pullback in the stock. Remember, no stock rises foreverā€¦
And another option would be to use the DCA UPā€¦ or dollar cost averaging up approach. I typically advise our subscribers who are looking to begin a new position with an existing GorillaPick to either wait for a pullback or purchase a smaller positionā€¦maybe 25%-50% of your typical position sizeā€¦ and DCA UP as the stock continues to display strength and climb upward.
So, whether or not you purchase the stock and simply focus on the second target goalsā€¦. wait for a pullbackā€¦ or choose to use the DCA up approachā€¦ there are many ways you can still take advantage of many of the current GorillaPicks, even though they may have already achieved their first target.
Have a great rest of your weekend, and Iā€™ll see you next Sunday with another subscriber Q & Aā€¦possibly yours!