The PLUTU$ Analytical Team defines a rocket stock as any NYSE or NASDAQ listed stock that gains 100% or more after issuing an official press release (PR) or making a U.S. Securities and Exchange Commission (SEC) filing. The rocket stock must not extend into more than one pre-market, market hours, or after-hours trading session before reaching 100%. Rocket stocks that extend into two trading sessions or more before reaching 100% do not count. A rocket stock must have an official news catalyst, and any rocket stocks that are based on analyst ratings, social media sentiment, speculation, trends, fads, rumors, or other factors are excluded.
While all rocket stocks must reach 100% to be classified as a rocket stock, some rocket stocks have been observed reaching 1,000% or more. Some of the biggest rocket stocks observed in 2020 were SPI which reached 4,345% on September 23, 2020, APM which reached 2,325% on September 29, 2020, and GLSI which reached 2,940% on December 9, 2020. These percentage gains occurred during the pre-market and regular market hours trading sessions within a 12 hour period, not over the course of multiple days or months. Rocket stocks occur in any market conditions, while an index or sector is up +2.73% or more or down -5.39% or more rocket stocks will still launch.
Rocket stocks are rarely covered in the mainstream media financial news, and yet they are the biggest gainers and often occur several times per week. While the PLUTU$ Analytical Team may sometimes engage in technical analysis using charts and indicators after a rocket stock has launched to help in determining when the stock has peaked, no form of technical analysis using charts or indicators is used to ascertain if a stock will rocket. The PLUTU$ Analytical Team only utilizes stock fundamental data in conjunction with factual information to confirm the catalyst in the form of an official PR to discover rocket stocks.
A rocket stock must have an official news catalyst, either an official PR released by the company or the company must make a filing with the SEC. While SEC filings can sometimes create a rocket stock they are a far less common official news catalyst (SEE: News Catalyst Sources Analytical Chart) than an official company PR. While some stocks will rocket because of an analysts ratings, social media sentiment, speculation, trends, fads, or other factors, these are excluded because there is no official news catalyst and they are often nothing more than a momentum rocket stock which tend to be extremely more volatile than a rocket stock with an official PR or SEC filings as the catalyst.
The SEC regulation called the Regulation FD (Fair Disclosure), states, "Under the regulation, the required public disclosure may be made by filing or furnishing a Form 8-K, or by another method or combination of methods that is reasonably designed to effect broad, non-exclusionary distribution of the information to the public." And Rule 101(e) defines the type of "public disclosure" that will satisfy the requirements of Regulation FD. Rule 101(e) states, "As proposed, Rule 101(e) gave issuers considerable flexibility in determining how to make required public disclosure. The proposal stated that issuers could meet Regulation FD's "public disclosure" requirement by filing a Form 8-K, by distributing a press release through a widely disseminated news or wire service, or by any other non-exclusionary method of disclosure that is reasonably designed to provide broad public access -- such as announcement at a conference of which the public had notice and to which the public was granted access, either by personal attendance, or telephonic or electronic access. This definition was designed to permit issuers to make use of current technologies, such as webcasting of conference calls, that provide broad public access to issuer disclosure events."
As the SEC EDGAR System processes around 3,000 filings each day, and most likely very few traders and investors read all of these SEC filings, because not only is it too much data for individual traders and investors to process in real-time, but the filings are also in a very raw data format with only the filing number and no actual headline in the title of the filing. Even if a trader or investor focused on specific SEC filings by number there would most likely still be too much information to process, and by the time that a meaningful SEC filings was discovered the stock would have probably already rocketed. There are many automated trading systems (ATS) which scan these SEC filings and are quick to move on any meaningful SEC filings. Unless a trader or investor has an automated trading system (ATS) in place specifically designed for scanning SEC filings directly it is nearly impossible to reliably and accurately trade stocks based on SEC filings sourced directly from the SEC.
And although the SEC has stated, "Regulation FD applies to social media and other emerging means of communication used by public companies the same way it applies to company websites." It should be noted that to date no rocket stocks have ever been observed which used social media or a company website as the sole means of communication to disseminate an official news catalyst. A company may use these alternative means of communication in conjunction with an official PR release disseminated through a PR news service or an SEC filing, but to limit the dissemination of a positive news catalyst which could result in the company's stock price increasing would be inefficient. Also to alert investors about which social media will be used to disseminate news could be very time consuming, unreliable, and even costly. If an investor is not alerted and misses a news release resulting in a financial loss the company could possibly be held liable.
Fortunately when a company releases news they most often do it though an official company PR and not an SEC filing (SEE: News Catalyst Sources Analytical Chart), as an official company PR will be seen by a far larger audience when the PR is picked up on by the mainstream media, other news outlets, and social media. Official company PRs are disseminated through one of four PR release services: Globe Newswire, PR Newswire, Accesswire, or Business Wire. In extremely rare instances a company will release a PR through multiple PR release services, but the PLUTU$ Analytical Team interprets this as a red flag as the company is possibly attempting to hype meaningless news, hence being released through multiple PR release services to gain more attention. To date there has never been a rocket stock observed which released a PR through multiple PR release services. On a rare occasion there may be a PR released through another obscure press release news service, like ANVS on May 21, 2021 which released a PR through Newsfile. To date this is the only rocket stock that has occurred based on a PR released outside of Globe Newswire, PR Newswire, Accesswire, or Business Wire.
All four of these PR release services are syndicated through the PLUTU$ Newswire and all of these PRs that are released can be filtered with PLUTU$'s unique algorithm which allows for PRs to be filtered based on stock fundamental data and other data points. This unique filtering technology allows for PRs to be viewed quickly and easily based on the stock price, float, average volume, market cap, and other data points. This filtration system is very important when the PLUTU$ Analytical Team is looking for rocket stock catalysts, because while although the catalyst is by far the most important aspect of a rocket stock, most Apollo 11 rocket stocks have certain stock fundamental data Criteria which makes them more likely to become an Apollo 11 rocket stock. This subject matter is discussed in more detail in the Criteria section.
While rocket stocks do not occur in every trading session, they do occur in many trading sessions and multiple rocket stocks can launch during the same trading session. During the 253 Trading Days of the year 2020 there were a total of 298 rocket stocks tracked and added to the Rocket Stocks Spreadsheet. The majority of PRs that launch a rocket stock are released between 6:00AM and 9:00AM ET and between 4:00PM and 6:00PM ET Monday - Friday during the pre-market and after-hours trading sessions (SEE: News Time Analytical Chart). Very few PRs that create a rocket stock are released during regular market hours between 9:30AM and 3:59PM ET. Therefore the PLUTU$ Analytical Team has concluded that it is vital to utilize a reliable commission free Brokerage Service which allows full extended hours trading between 4:00AM and 8:00PM ET, as many Brokerage Services only offer regular market hours trading or have limited pre-market and after-hours trading, or the Brokerage Service may charge commissions on each trade that is made. Using a Brokerage Service that does not offer full extended hours trading means that traders and investors would be unable to buy the rocket stock when the PR is released outside the trading hours of these limited Brokerage Services and would only able to buy the rocket stock after it has already launched, or they end up paying unnecessary commissions each time a stock is bought or sold. See the Brokerage Services page for details.
Some PRs that propel a stock to rocket are released during off-hours which is outside of the pre-market, after-hours, and regular market hours sessions between 8:00PM and 3:59AM ET Monday - Friday, and anytime on Saturday or Sunday, but these stocks can not be traded as markets are closed when the PR is released, and therefore these PRs would be counted as pre-market session PRs. The PLUTU$ Analytical Team has often observed that when a PR is released during the off-hours the stock will have so much interest in it by the time the pre-market session opens at 4:00AM the stock will often rise up very rapidly initially and then crash and burn resulting in an Apollo 13 rocket stock. As the PR has had ample time to circulate and so many traders and investors have placed orders to go through at exactly 4:00AM when the pre-market session begins and can potentially result in the stock becoming extremely volatile. This very rapid initial rise up can potentially trigger sell orders which execute when the stock hits a certain threshold, and this in turn can potentially result in a ripple effect selloff. The PLUTU$ Analytical Team has learned to expect the unexpected, and to always be extremely cautious when trading or investing in a stock based on a PR that has been released during the off-hours.
Although there is often a rocket stock every day, there can be dead times when there will be numerous days in a row and there are no rocket stocks. Early September 2020, April 2021, and May 2021 are examples of these dead times (SEE: Rocket Stocks Spreadsheet).
The PLUTU$ Analytical Team has determined that trading rocket stocks is one of the most difficult types of day trading to master, but by far one of the most lucrative if a strategy and ruleset is developed and maintained. The PLUTU$ Analytical Team also concluded that often times when trading or investing in rocket stocks proceeding with extreme caution was still necessary even when a custom strategy and ruleset was created to correspond to a trading or investing style. This is very similar to what was previous deduced by the PLUTU$ Analytical Team prior to this study, in that it is extremely important in all forms of trading and investing to have not only a strategy, but a ruleset within this strategy. The strategy can and will evolve over time, and there will always be exceptions to the ruleset, but when an exception to a rule arises the PLUTU$ Analytical Team again concluded that proceeding with extreme caution and always considering the risk to reward ratio helped to reduce financial losses. The PLUTU$ Analytical Team also concluded that financial losses could be reduced by using Paper Trading first to develop and test any custom strategy and ruleset before ever using real money. Many Brokerage Services now offer accounts with free Paper Trading.
Any content or services provided by PLUTU$ does not constitute a solicitation nor should it be construed as investment or trading advice, or an offer, recommendation, or endorsement to buy or sell any securities or related financial instruments, and PLUTU$ makes no representation and has no opinion regarding the advisability or suitability of any investment or trading of any security or other financial instruments. Any securities or related financial instruments mentioned in the content and services provided by PLUTU$ are done so for informational or reference purposes only or given as an example to illustrate an opinion or observation. Some content and services provided by PLUTU$ may be educational or observational in nature and is not designed to recommend or endorse any specific financial, trading, or investment product, service, or strategy.
PLUTU$ - 'Financial insight without all the noise.'