So what is this ScoreMetrics thing?
ScoreMetrics is an opportunity to increase your wealth.
Put another way, ScoreMetrics is a highly advanced method of using sports analytics and historically back-tested data to create varying systems that allow us to use the scores of sporting events as an investment market that has zero correlation to any of the other markets you may have invested in or are currently are invested in.
Here’s something our VIP Members already know. The back-tested results of our members-only alert system, based purely off of the ScoreMetrics method, has a staggering 6796% ROI over the last four years! And there I go bragging again.
ScoreMetrics is really my answer to what happened to me in 2008. You see, I may have lost just about everything, but I did not intend to take that lying down. The problem back then was that my thinking was “inside the box” and I knew that in order to build a better mousetrap, I had to think outside of that box.
I always say if you want to be a 1%’er you can’t think like the other 99% and that means that you need to innovate and blaze new paths to places no one has been before. To accomplish what I wanted, I needed to lift up every rock and look inside every corner until I found the answer. It was with this singular thought in mind that I began my work.
I was determined to create that wealth again and, this time, my car would be faster, my girlfriend would be even hotter and, most importantly, when the next crash would come, I would make sure it does not affect me. When the bottom falls out of the economy again I would be standing on the mountain, thumping my big chest like King Kong shouting “You didn’t beat me this time!”
I decided to dedicate every available free moment to researching and looking for real “Zero Correlation Markets,” markets that were not moved by a housing market or stock crash (more about this later).
What I learned changed my life forever.
The first thing I had to do was ask the question: what is it I am actually doing to determine my choices in stocks, bonds and other investments?
I had always invested based on data…fundamental and technical information that led me to a conclusion about which side to take and which market or project to invest in. I would spend hours upon hours trying to find the trends, countertrends, and the fundamental indicators to tell me when to buy and at what price to buy at.
I realized, through all this research, that we decide where to wager our money based on the data we have and the paths we see. Every investment is a wager. Sometimes we win and sometimes we lose, but a good part of the battle is understanding that part of it, detaching your emotions from it, and making educated decisions as you move forward. Information is the key and, as long as I derive the correct conclusions from it and then follow them, I can live with what happens next.
And then it hit me. I realized if that is really the case, then it doesn’t matter if I am trading widgets, moon dust or Apple stock – I am simply doing market analysis and making an educated decision based on that information.
That is when I started to see it all for what it truly was and I realized the path that I had to go down. My goal was to find a market that could truly achieve 0 correlation to any other market. A market where I could still apply the same strategic approaches and logic to my investing. For years I tested countless theories based on these principles and finally landed on someplace that knocked me out of my chair – sports.
Sports hits all the marks – frequent trading opportunity, market data and analytics through the wazoo, liquidity, and now legality and access like never before. But the best part…and this is the part I really love…is that the winner of the Mets vs Dodgers game is not determined by Trump’s dealings with China, the Fed’s next rate cut or Tesla’s latest earnings announcement.
Sports simply doesn’t care whether the economy crashes, the US goes to war over camera phones or the President goes through a 4 month impeachment trial.
NOTHING external affects these markets and the data that I now have access to. This is true 0 correlation!!
The best part is that by applying analytics, systems and trading approaches to sports, I leverage the same logic you apply to your stocks, futures or crypto trading, but to a completely uncorrelated market. This has given me a new way to diversify my portfolio that not only makes me whopping gains, but helps me sleep a lot better at night.
I finally control my own destiny.
Now, I call it “sports trading” because ScoreMetrics approaches investing in sports the way other people approach their stock and futures trading. Sports trading in this way lets me use the historical patterns and trade the likelihood of that pattern continuing.
The method can be used on any sport but currently at the ScoreMetrics labs we focus purely on 3 sports; basketball, football and baseball and we produce almost equal success with each. Just talking baseball season (6 months each year), ScoreMetrics baseball has back-tested returns of 169%, 164% and 217.9% the last three years alone!
With success came growth and I even went so far as to hire a team that helps me source what I need for ScoreMetrics. They are now part of the ScoreMetrics Lab, a crack research and analytics team hand picked by me. The team dives deep into endless data to discover patterns sometimes weeks in advance. Any pattern that does not meet ScoreMetrics back-tested criteria is tossed and the ones that do meet it, go into my portfolio. With ScoreMetrics, for example, I can identify a pattern that has made money 78 out of the last 100 times the pattern has appeared. I then apply my one-of-a-kind money management approach to the trades to manage risk and leverage higher performing trades.
And perhaps the most intriguing part…methodology like this has been used by the most successful investors for over 100 years, but in sports, this type of trader’s approach is completely new! I dare you to find five people you know doing this. Heck, show me one person you know using systems to trade sports and I’d be ridiculously impressed. It’s like finding a needle in a haystack! This is a truly innovative way to approach investing.
When it comes to the stock market I used to feel that I was the one that was sitting down at the table with a bunch of pros and I was late to the game. With sports trading, I am blazing a new frontier because of how I approach making money. I get a chuckle watching all these old school odds-makers and “gamblers” still way behind the times, and I laugh even harder at investors who don’t see the massive potential here.
It has been over a decade since the last big market crash, which destroyed billions of dollars in asset value in stocks, commodities, real estate and more. The crash was as bad as it was, in part, because the investing masses didn’t assess the correlation risk of their investments.
I shared my story earlier, but aside from that, I don’t really think about it anymore, because it won’t happen to me again. I am prepared. Are you?
0 correlation investing does not exist in the markets we were told it does, but it does exist in sports, and you can apply the same logical approaches you have used in your traditional investments to this newly legalized frontier for traders.
Now, before you move on to the next chapter, I do want to share some of the secrets of how I create the systems that make up the ScoreMetrics method. I have a whole section on this later in the book but, as I said before, things like this I may mention a few times so you can really “get it.” I want you to leave this book thinking that you understand the methodology and feel comfortable making systems yourself.
So let’s take a moment and look at The ScoreMetrics Baseball Method. This currently consists of seven proprietary systems, five of which we share with our VIP Members and two of which we keep as our secret sauce and fire out alerts as they come in.
We normally explain these systems as video tutorials and then update our members with “signals” several times per week via email and text. If you’re not a member, but you have the book, you can create your own methodology following the same steps. I will just warn you in advance; it is a time consuming process. For this upcoming baseball season alone we have well over 4,000 lab hours invested into testing and analyzing data chains. But the time invested is well worth it.
I repeat this often when I speak in public and throughout the writing of this book, but it’s worth repeating again; the most important thing to understand about ScoreMetrics is that this method was not created for gambling.
The ScoreMetrics methodology was innovated as an alternative investing method that diversifies an investment portfolio into markets that have no correlation to traditional property, stock or commodities markets.
ScoreMetrics is a non-emotional investment method that sets a clear path that we follow with the end goal being profit and an increase in wealth. Like all investments, there will be ups and downs, but we diversify inside the method with several different systems running simultaneously. This approach spreads risk, while leveraging the systems in the method to make your money work harder. If you are truly interested in creating your own systems and method, we highly suggest 6-8 systems, that follow our guidelines in order to diversify yourself and mitigate possible losses.
Let’s dive quickly into what qualifies a system to be a ScoreMetrics system.
The ScoreMetrics Rules
Every ScoreMetrics System must pass the rigorous standards of our labs to make sure it can stand the test of time. This includes years of privately testing algorithms, models, and research mechanics in order to make sure that each system can fit our criteria.
Every system starts with a sound theory, but the data analytics performed in our ScoreMetrics lab take these hypotheses to another level, by looking at every data point possible, even ones that were not considered in the original theory. This allows one theory to become 1,000’s of different possibilities with millions of data chains. ScoreMetrics doesn’t discriminate. If a system works, and it follows our criteria, it goes into the portfolio.
We do this by applying 3 to 6 rules to each system test. Never more and never less. This requires lots of late nights and constant testing and retesting to find the sweet spots in different scenarios, in both a performance sense as well as an odds perspective.
As complex as the methodology is, there is a simplicity in the fact that we are only looking for patterns that have success over a long period of time. Most systems are tested over ten years, with a minimum of 8 years of positive ROI required in that time period. Once your system is created and you have that time tested information, you have to give it The Score.
The Score is taking the average of all the years ROI’s and making sure they are greater than the lowest year by 20% in order for it to be qualified as a ScoreMetrics system.
Average ROI 57%
Worst year ROI 23%
57% is greater than 23% by 34% which, of course, is greater than the 20% we require for The Score.
There are a few special circumstances that would allow for less data to be used, and in those systems, we allocate less risk because, while the data is sound, it is not tested back far enough for our normal standards. Under these circumstances we would still require 4 years of data and during that time, no year would be allowed to have a negative ROI and the lowest ROI per season we would accept in that system would be +20%. I highly recommend NOT using systems like this unless they follow these exact requirements and have at least 3 other back-tested systems that follow our original guidelines.
There is also a special circumstance that would allow you to forgo The Score and that would be if your back-tested data shows no losing years, but be wary because everything that goes up can go down.
Let me share with you a system we were working on so you can better understand how to build your own system. This is a system the data lab spent several days on, only for me to realize that it was not up to ScoreMetrics standards. I am simply using this as an example and I do not advocate using this system in any practical way.
In other words, this system is no good. I figured I would say that twice, just to be sure that everyone understood it. We are just using it as an example of how to build a system. Please do not use this system.
Let’s break down the theory.
Before we get too far though, it is important to note that no theory is designed to find all winners. That is what gamblers fool themselves into believing they can do. Instead, systems should be designed to find patterns that create positive ROI’s over a long period of time. So if a system has 25 games inside of it during a season, we don’t care how many wins or losses the system has; we only care that the system adds profit to our bottom line.
So, with that explained, the theory behind the example system below was supposed to be finding late season underdogs that provided good value.
The example system rules are as follows.
- the team we are investing in have a win percentage between 31% and 55%
- the closing moneyline is between +125 and +160
- the opposing team’s win percentage is between 47% and 55%
- the closing total is between 8.5 and 10.5
- remember that it was supposed to be a late season system so we are looking for games played in August,September or October
So above you see 5 layers of data, which puts us just inside the maximum amount of rules recommended by ScoreMetrics. Again, we recommend 3-6 layers of data, with 5 being what we found to be the sweet spot.
At first glance, this one looks like a winning system because looking at 2019, the system had an ROI of 25.1%. Wow! Awesome!! Cash those checks!
Not so fast.
The problem comes in back-testing the data and seeing the extreme volatility in the system.
2018 had an ROI -12.5% and that is just one of FOUR losing seasons over the last ten years. Again, not a good system, but just an example of how you would build yours, if you choose to do so.
For those of you that are real investors out there I am certain that you have either created or used systems like this before, but no one in the sports world is doing anything quite like this and no one is showing back-tested returns like the ROI from ScoreMetrics.
Now the question you might be asking yourself is “Why do I need ScoreMetrics?”.
Well, that answer is simple. Because you probably think your current investments are safe and you are also most likely thinking that you are diversified into enough different areas that there is no way you could put yourself at risk for the same thing that happened in 2008.
Well, you are unequivocally wrong. Moving forward, I will explain to you just how at risk you are and how ignoring that risk is the worst idea ever.
Before I do that, I will touch on one of the most important topics we will cover in the book. Actually, it’s a question I get asked more times than any when I speak in public; is it legal for you to move forward and try ScoreMetrics? There is a very good chance it finally is.