SEPA (Specific Entry Point Analysis) is the growth-momentum stock-selection system developed by Mark Minervini, two-time U.S. Investing Championship winner and author of Trade Like a Stock Market Wizard (2013) and Think & Trade Like a Champion (2017). It is built on the conviction that the largest gains come from young, fast-growing companies whose superior earnings are confirmed by a powerful price uptrend. SEPA fuses fundamental analysis (earnings, sales, margin acceleration) with strict technical timing, so a buy only happens when a leading stock is in a confirmed advance and offers a low-risk, precise entry point. It is a swing/position-trading framework — holding periods range from weeks to many months — that pairs aggressive winner-selection with very tight loss control.

SEPA

SEPA organizes the analysis of any candidate around five core elements:

1. Trend — The stock must be in a confirmed price uptrend (Minervini's "Stage 2" advance, borrowed from Stan Weinstein's stage analysis). Minervini's research holds that the overwhelming majority of superperformers were already trending up before their biggest moves; he will not buy a stock in a Stage 1 base, Stage 3 top, or Stage 4 decline. 2. Fundamentals — Strong and ideally accelerating earnings, sales, and margins, typically from younger companies with a scalable model. This is the why behind the move. 3. Catalyst — A driver that attracts institutional buying: a new product, FDA approval, new management, a new industry trend, or an earnings surprise. 4. Entry point — A precise, low-risk technical setup. Minervini's signature pattern is the VCP (Volatility Contraction Pattern), where pullbacks within a base get progressively shallower on declining volume, ending in a tight "pivot" that, when cleared on volume, defines the entry. 5. Exit point — Predefined risk management. A stop is placed just below the pivot/entry so the initial loss is small, and rules govern when to take profits or recognize the end of the Stage 2 advance.

The focus throughout is on leading growth stocks in a Stage 2 uptrend — the few names showing both the best fundamentals and the strongest relative price action.

The Trend Template

Before any deeper work, a stock must pass Minervini's published Trend Template — an eight-point technical filter (using simple moving averages) that confirms a Stage 2 uptrend:

1. Price is above both the 150-day and 200-day moving averages. 2. The 150-day moving average is above the 200-day moving average. 3. The 200-day moving average is trending up (for at least one month; preferably 4–5 months). 4. The 50-day moving average is above both the 150-day and 200-day moving averages. 5. Price is above the 50-day moving average. 6. Price is at least 30% above its 52-week low. 7. Price is within 25% of its 52-week high (the closer to a new high, the better). 8. Relative Strength rating (as reported by Investor's Business Daily) is at least 70 — preferably in the 80s or 90s; true leaders often show 90+ early in their moves.

All eight must hold simultaneously; failing any one disqualifies the stock. The template is a screen, not a buy signal — it narrows the universe to genuine uptrends.

How it's used in practice

The workflow is sequential and funnels from broad to narrow:

1. Screen by the Trend Template to isolate stocks in confirmed Stage 2 uptrends. 2. Apply SEPA's fundamental and catalyst filters to keep only true leaders with accelerating numbers and a reason for institutions to buy. 3. Wait for a precise entry — typically a VCP base that tightens into a low-volatility pivot, bought as it breaks out on expanding volume. 4. Enforce tight risk — a stop just under the pivot keeps individual losses small (Minervini stresses average losses well below average gains and overall risk near a single-digit percentage), with profit-taking and trailing rules as the move matures.

The template provides the trend confirmation; the VCP provides the timing; the stop provides the survivability.

Standing & honest note

Minervini's track record is unusually well-documented for a discretionary trader: he won the U.S. Investing Championship in 1997 and again in 2021 with audited, real-money returns, lending genuine credibility to the approach. The Trend Template itself is fully public and easily coded into any screener, and its logic — buy confirmed uptrends near highs, with strong relative strength — is sound and widely echoed by IBD/CAN SLIM-style growth investing.

The honest caveat is that the edge lives mostly in the discretionary layers, not the screen. The Trend Template will return hundreds of names; SEPA's results depend on subjective reads of VCP quality, catalyst strength, market context ("trade in harmony with the general market"), position sizing, and disciplined selling. These are hard to replicate and harder to automate, and Minervini operates in concentrated, high-momentum names with very tight stops — a style that demands constant attention and tolerates frequent small losses to catch the occasional large winner. Backtests of the Trend Template alone produce ordinary results; the framework should be treated as a disciplined process for leaders, not a mechanical system, and right-sized to the user's risk tolerance and ability to manage stops actively.

Sources

• Mark Minervini, Trade Like a Stock Market Wizard (McGraw-Hill, 2013) — original SEPA and Trend Template definitions.
• Mark Minervini, Think & Trade Like a Champion (2017) — VCP and risk-management detail.
• ChartMill, "Mark Minervini's Trend Template (TTP) Stock Screen" and step-by-step guide — chartmill.com.
• Deepvue, "The Mark Minervini Trend Template" — deepvue.com.
• The 7 Circles, "Mark Minervini 1 — Specific Entry Point Analysis (SEPA)" — the7circles.uk.
• U.S. Investing Championship results (1997, 2021), per public championship records.