“So You Think You Can Trade” (Results)
“So You Think You Can Trade” (Results)
OK, that was fun.
The results are in from Paradigm’s first-ever 30 Day Top Trader challenge.
In late March, thousands of readers like you took on the challenge of identifying the one stock or ETF with the biggest profit potential between April 1–30.
As we said at the outset, this was an unusual exercise: Forget about fundamentals. This wasn’t about identifying a “good company” with “steady growth.” This was about short-term catalysts — biotechs with big news, short-squeeze candidates, leveraged ETFs with a trendy tailwind.
And the fixed start and end dates? That only amped up the element of surprise.
Sure enough, the best-performing pick among our readers during April was a biotech that lay low until nearly the end.
Curiously, however, it wasn’t a blockbuster trial result or an FDA approval that gave a huge lift to Edesa Biotech (EDSA) — just speculative buying ahead of a presentation the CEO will make later in May at a conference in Orlando. The company is making tracks on Phase 3 trials for a treatment of acute respiratory distress syndrome — a sudden and severe inflammation of the lungs.
EDSA’s share price went nowhere most of April. Then it suddenly took off — racing from under $7 on April 24 to over $18 on the 30th. It wasn’t until the final day of the challenge that EDSA emerged as the best performer of April — leaping 237.8% over the 30 days.
A total of 19 readers — fewer than one-tenth of one percent of the challenge participants — chose EDSA as their top performer of the month.
This is why we had readers make a second and third choice in addition to a top pick — to serve as tiebreakers.
Having said that, we’re still not in a position to tell you who won the grand prize of $50,000 — nor the winner of the $10,000 second prize and $5,000 third prize. The reason is simple: We’re still trying to get in touch with them. (Really, if it were you, it would be weird if you read it here first!)
Some more fun facts emerging from the challenge…
The second-best performer of the month was Axe Compute (AGPU) — which experienced two big leaps during the month before pulling back. Between April 1–30, it gained 219.5%.
The most popular pick, chosen by nearly 1,300 participants, was AST SpaceMobile (ASTS) — a favorite of our tech/biotech specialist Ray Blanco. As we chronicled in these pages, ASTS hit a speedbump on April 19 with its ambitions to deliver wireless service via the mobile phone you already carry in your pocket: The Blue Origin rocket carrying ASTS’s inaugural satellite failed to deliver it to the proper orbit. It fell back toward Earth and burned up in the atmosphere.
ASTS ended the 30-day period down 12.6%. But Ray’s conviction remains solid: The firm still plans to launch dozens of satellites this year — and it has launch contracts with firms other than Blue Origin.
Finally… among all the contest entries, the median return was 6.9%. Nearly two-thirds of participants — 63.6% — ended the month with their top pick in the green. And 1.2% submitted a pick that gained 100% or better.
Congratulations to the winners and thanks to everyone who took part. We’re already thinking through how to do something like this again and make it even better. Stay tuned…
War Back On?
The U.S.-Iran ceasefire is facing what looks like its most severe test since it came into force April 8.
The trading week started quietly enough, with Donald Trump announcing a scheme to “guide” shipping through the Strait of Hormuz.
The initial announcement came on social media yesterday — and gave the impression that U.S. warships might be escorting commercial vessels through the strait.
Not so, said The Wall Street Journal: “The new mechanism is effectively a coordination cell to move traffic through the strait, involving countries, insurance companies and shipping organizations.”
“In other words,” said one cynic on X, “another Sunday market pump.”
And it worked for a while: U.S. oil futures fell as low as $102 while stock futures were in the green.
Then everything started heating up this morning.
Iranian state media says Iranian forces fired warning shots at a couple of U.S. destroyers. Then a huge oil terminal in the United Arab Emirates came under Iranian attack. This terminal is the UAE’s only means of bypassing the Strait of Hormuz.
CNN says Washington and Tel Aviv will return to war within 24 hours.
With that, U.S. oil futures are back to $105.59. And while the major stock indexes opened the day flat, they’re now decisively in the red.
The S&P 500 is down a half percent from Friday’s record close at 7,191. The Nasdaq’s loss is about the same; the Dow is down 1%.
“We’re experiencing a split market right now that’s yanking around different stocks and sectors every single day,” writes Greg Guenthner at The Trading Desk (who won our internal version of the Top Trader challenge. No prize, just bragging rights.)
“This back-and-forth action continues to dominate the tape. On Friday, the tech trade stole all the green while industrials, energy and consumer names slipped. On days where semiconductors are rallying, software stocks take a beating. The next day, they flip spots.
“These moves can be frustrating, for sure. But it could all be part of a bigger consolidation looming now that the averages have fully recovered from their March lows. The market ran white-hot for an entire month so it’s going to need to rest at some point.”
If the war is coming back into view, earnings are not retreating: Reports will continue to pour in this week although Nvidia is the only one of the “Magnificent 7” we’re still waiting on — and NVDA doesn’t report until May 20.
Of the S&P 500 companies that have reported so far, FactSet tells us 84% have beaten the estimates of Wall Street analysts — better than the averages of the previous five years and ten years. And the average “beat” is by 20.7% — well above the recent norm.
➢ For the record: Spirit Airlines shut down over the weekend; for whatever reason the scheme the White House was hatching to use Spirit’s jets as troop transports didn’t pan out. As Sean Ring points out in today’s Rude Awakening, Spirit was not “too big to fail” — a rarity for a publicly traded company in 21st-century America.
Precious metals are losing ground — gold clinging to $4,500 and silver back under $73. On the other hand, Bitcoin is back over $80,000 and Ethereum is at $2,363.
Report From Omaha
The “new” Berkshire Hathaway is ready to deploy that enormous pile of cash it’s sitting on.
Saturday was the first BRK shareholder meeting in Omaha, Nebraska where Warren Buffett did not preside as CEO. Instead it was his chosen successor Greg Abel.
Our senior investment director Enrique Abeyta was in attendance…
… and keen to hear what Abel had to say about the record $373 billion cash pile the company had accumulated by year-end 2025.
“Many investors believe this was intentional,” Enrique wrote his Truth & Trends readers ahead of the meeting — “that Buffett, in his final years at the helm, chose patience over action to give his successor maximum flexibility.”
Sure enough, Abel said on Saturday that Berkshire has a shortlist of companies it wants to buy — in part or in whole.
At the right price, of course. “There will be dislocations in markets that will allow us to act,” he said.
Buffett jumped on such “dislocations” when they presented themselves over the decades.
“During the financial crisis,” Enrique said by way of example, “Buffett deployed capital into companies like Goldman Sachs and Bank of America on extremely favorable terms, locking in high returns and reinforcing Berkshire’s reputation as a lender of last resort.”
Look for Enrique to share more reflections from Omaha later today when a new Truth & Trends is published.
Comic Relief
There are “sin taxes” and then there are…
Mailbag: Protests, Reading Comprehension, High-end Audio
On the subject of the May Day protests mentioned off the top Friday, a reader writes…
“Recently the socialist Minneapolis City Council approved funding to assist renters who fell behind in their rent because they couldn't leave home during the ICE episode.
“During that time there were protests encouraging people to stay home from work, school, shopping. You can't make this up.
“IMO, they have been turning Minneapolis into a sh***ole. Used to spend a lot of time and money there, haven't stepped foot there since George Floyd and won't in the future.”
Dave responds: Numbers are hard to come by, but it seems the May Day protests were a bust — with considerably lower turnout than the “No Kings” protests that take place on weekends and draw an older crowd.
Doesn’t bode well for the organizers if they hope to pull off a nationwide general strike on May Day in two more years. On the other hand, a lot can happen between now and then…
I was stunned to read the reason why a reader demanded over the weekend that she be removed from the 5 Bullets email list.
The relevant passage, and the trigger for her outrage: “If you’re taking jabs at people who are constitutionally using their First Amendment rights — if you don’t like it — too bad, shove it up your a**es.”
Then followed a spirited diatribe against Donald Trump.
Too bad her outrage overwhelmed her reading comprehension: I took a minor swipe at Jimmy Kimmel during Friday’s editionin defense of his right to say stupid things. I was taking the president and his FCC chair to task for actions that undermine the First Amendment.
This is every bit as pathetic as conservative readers who call me a “liberal” when I deign to say critical things about the Iran war. Is Tucker Carlson a “liberal”? Ron Paul?
No, this is not a renewed plea for sympathy on the part of the many gracious readers who rose to my defense (and in one notable case, apologized) when the partisan vitriol got out of hand last month. Just another reminder that tempers are on a hair trigger in the society at large.
“Sometimes it’s easy to get myopic and single-minded about markets, money, accumulation, investment, the rat race,” says our next entry.
“It’s a pleasant diversion to see many of your readers have other interests and passions, regardless of what they are.”
That’s a reference to last week’s mailbag thread where we went off on a high-end audio tangent. On the subject of my budget-audiophile NAD CD player, the reader adds: “I can only say go NAD!
“Hehe, some of us are juveniles too! :)”
Dave: LOL, I remember seeing Corey Greenberg write, “Go NAD,” in the pages of Stereophile magazine in the early 1990s.
Greenberg was the young gonzo writer they brought in to shake up an otherwise stuffy editorial stable. My 20-something self thought his prose alone was worth the subscription price.
This was long before he sold out and took payments from companies to shill their products on the Today show.
“That audiophile change-up was a nice stress-buster,” says another reader.
“Much needed and a reminder of things that really matter. Thanks and the very best for upcoming weeks ahead as we will all be tested.”
One more item of feedback, and there’s not space to share the whole thing — but the reader had a suggestion: “With all the ELP Tarkus talk, maybe you can get the guys to play ‘Lucky Man’ for the announcement of the winner of the Trader Challenge!”
Love it. Let’s take it out today with their live version from the Royal Albert Hall on their 1992 reunion tour…
