3 Dumb Ideas That Appear Brilliant

Tell me if this sounds familiar…

Your friend, who always seems to hit monster trades, offers a “hot” idea.

He tells you that Meta (NASDAQ: FB) is about to explode higher in a matter of days.

You know you need to act quickly. But the last time you jumped on his idea, you screwed up the position size, the trade went awry and you lost FAR MORE than you expected.

This time, you plan to do better… Plus, you just learned about option hedging strategies.

You decide to buy Meta. However, you also buy put options on Google (NASDAQ: GOOG). In your mind, if Meta doesn’t rise and falls instead, Google should as well, since they’re both tech companies.

The fateful day rolls around, and wouldn’t you know it, Meta crashes while Google actually rises.

Your brilliant strategy backfired.

No one will EVER accuse Joe Biden of outsmarting himself. But as investors and traders, we do it ALL THE TIME.

People always assume intelligence = profits.

That’s not how investing or trading works.

It’s not about making brilliant moves. It’s about striking when opportunities arise in a systematic, repeatable fashion.

You want to be less like an inventor and more like an accountant.

Our goal is to help you protect and grow your wealth in a consistent, predictable manner.

We want you to be SO GOOD AT MAKING MONEY THAT IT’S BORING.

This could be much closer than you realize. All you need is a program tailored to YOU.

However, you’ve got to first clear away the clutter that prevents you from making objective, mechanical decisions.

That starts with recognizing and tackling the three “overthinking” problems we all face.

#1 – Complex Strategies

Our tale of the friend and his Meta trade actually happened to a member of our staff.

He’s incredibly brilliant and able to analyze 10-K forms and whatever else have you like no one’s business.

But when it comes to trading and investing, he gets too complicated and loses focus on the fundamentals.

You see, smart people feel like if a trade or investment is too easy, then something is wrong.

One of our favorite examples came from a Reddit post where a trader asked for help.

He would buy the SPY Exchange-Traded Fund (ETF) (NYSEARCA: SPY), which tracks the S&P 500, and then hedge it by buying the SPXU ETF (NYSEARCA: SPXU), which tracks the inverse of the S&P 500 with 3x leverage.

Someone quickly pointed out that the strategy is needlessly complicated. The poster could just buy fewer shares of the SPY, rather than buy the SPXU.

Think about the last time you were in a position that didn’t go your way. Instead of just taking a loss like you should have, you looked at a few other charts, rationalized why you should “stick with it” and ended up taking a bigger loss than you intended.

The trick to profitability isn’t pulling from a wide array of different ideas or strategies. It’s getting incredibly good at just one niche. Then you expand outwards.

#2 – Chasing Perfection

Do you know someone who loves to talk about how they nailed the top or bottom of the market?

Perfect timing and bragging rights aren’t a recipe for profitability.

Neither is being ultra-conservative.

Think about how often you’ve heard about Warren Buffet’s style of value investing. Supposedly, he waits for a nice discount and a cushion of safety on top.

If you followed that advice, you’d have missed out on the entire decade between the Great Recession and the pandemic.

This problem often plagues the risk-averse, who fear losing money above all else.

Investing isn’t about waiting until you get the perfect price or valuation. It’s about finding one that’s a good deal, relatively speaking.

Say you’re trying to buy a new car to drive to work. With inflation skyrocketing, waiting until prices drop to where they were in 2019 isn’t realistic. But waiting for an end-of-year sale on your model is.

#3 – Trading Too Often

People assume that “MORE” means more money.

What do we mean by this?

We’re told that MORE diversification is a good thing.

But those same teachers never mention that too much diversification makes your portfolio perform like an index.

If you want to outperform the market, it’s about selecting the BEST ideas and stocks, not every single one that comes our way.

We’re told that MORE activity helps us outperform the market.

However, it’s not about the volume activity so much as the quality.

Investors who constantly make adjustments never allow their ideas to fully flesh themselves out. Instead, they cap them at the knees.

They’re always trying new things instead of getting good in one area — the whole “jack of all trades master of none” concept.

Folks who always want another trade or investment idea end up in terrible positions.

In fact, what if we told you that a portfolio of just three stocks could beat the market?

We’re not talking about cherry-picking the top performers. Instead, we are discussing a simple, time-tested strategy that isn’t complicated, doesn’t seek perfection and is easy to manage…

…what Jim Woods calls his PERFECT PORTFOLIO…

Click Here to see how just THREE stocks can change everything.