This week’s TPOW (Top Pick of Week) featured SoFi Technologies (SOFI), which we picked up on Monday, February 3rd, 2025, at an opening price of $14.98. Over the course of the week, SOFI showed some volatility, peaking at an intraday high of $15.62 on Tuesday, February 4th, 2025. This represented a 4.2% gain above our purchase price, offering a strong opportunity for a quick profit if we had opted to sell early. However, as per our TPOW strategy, we held on to the stock throughout the week, and by Friday’s market close, the price had decreased slightly to $14.91, resulting in a modest -0.47% return.
While it might feel like a missed opportunity, it’s important to understand that this week’s result is part of the broader strategy behind TPOW. There are two basic approaches when managing these trades:
- Current TPOW Strategy: We hold the stock until Friday’s closing price unless it hits our target gain of 15% during the week. This approach is designed to capture the significant upside potential of a stock breaking out of the green zone. Historically, this strategy has resulted in massive gains as stocks tend to “pop” when they meet our momentum criteria. The key to this approach is patience, as we believe the best profits often come from holding out for the larger moves.
- Alternate Approach (Set a Sell Limit): The second approach involves setting a sell limit—anywhere from 3% to 5%—to capture smaller but more consistent gains. This strategy is particularly useful in volatile markets where big price swings may not materialize by week’s end. A 4% gain might seem small, but in a choppy market, it can still be a solid return. Remember, TPOW is built on the power of compounding weekly returns, so even smaller, consistent gains can add up over time, leading to significant growth when applied consistently week after week.
The takeaway here is that both strategies have their place, and each has its own merits. Our current approach is focused on maximizing long-term gains by holding out for those bigger moves, but capturing a small, steady gain of 3-5% can still be incredibly rewarding, especially when the market is volatile like we’ve seen recently. For this week, while SOFI didn’t hit our target gain, the stock still showed solid potential, and we learned valuable lessons that will help us refine our future picks.
As always, we’ll continue to monitor the market and adjust our strategies based on market conditions and our stock selection criteria. We’re excited to see where next week’s TPOW takes us!
