☕ 5 straight-shooting, no-frills Keithisms if you don't know what to do next

Good morning! 👋 

There is everything and nothing that we haven’t talked about already in excruciating detail happening this morning. Rather than re-hash that and bore you to tears, let’s get down to business.  

Chaos always creates opportunity! 

Here’s my playbook. 

1 – Rotation is a myth 

A quick look at the headlines and I see “rotation” screaming from one side of the Internet to the other.  

Don't fall for it. 

Rotation implies that the markets are a zero-sum game because investors move their money from one sector to another. If money comes out of tech, it must therefore go into value, or dividends or bonds or something else according to pundits, pontificators, and posers. Then back again.  

That’s not how the game is played.  

The markets continually create new profits as prices rise and fall. That’s why, over time, long-term investing gains tend to overshadow short-term trading results.  

Big dips and selloffs bring more stable, less active money into the markets in search of new opportunity every time.  

The world’s most successful investors don’t have directional risk the way you'd think because they a) focus on quality names, b) control risk as part of the buying process over longer-term horizons and c) continually play offense even if they must think defensively to do it.  

If that sounds familiar, it should.  

I encourage you to do the same dang thing constantly!  

Moreover, I share my thoughts with anybody who’s interested on TV, right here and – for those who want more including the how, when, and why that can help take things to the next level – in One Bar Ahead® . I’d love to welcome you on board if that’s helpful. (Upgrade) 

If you’ve got this covered or at least think you do, cool beans! 

2 – Mind over matter 

If you don’t mind, big selloffs don’t matter. 

3 – Think like a wolf, not a sheep

I often tell investors to pay very careful attention to what Wall Street does, not what it says. 

For example, small caps have been all the rage in recent weeks as Wall Streeters talk up the need to “broaden markets” as interest rate cuts loom. Right on cue, small caps took off in an epic 5-day run, the fifth since 1979. 

Investors are positively giddy that the Russell 2000 is up 12.8% or triple the S&P 500 over the past month. 

Umm, yeah. 

Watch this video from Jim Cramer explaining the basics of stock market manipulation. (Watch) 

Now, ask yourself three questions:

1. What do you think is really happening? 
2. Who do you think has their wallet in the game? 
3. Who do you think is buying today? 

Wall Street’s biggest players are known to go to extreme lengths to convince you the sky is falling while they’re buying. And that prices will go to the moon while they’re selling. 

This is a one week move into small caps. 

One week. 

On the other hand and to my earlier point, Nvidia has returned 2,939.14% over the past 5 years while the S&P 500 has tacked on 103.21% over the same time frame. IWM, a popular ETF proxy for the small cap Russell 2000 has returned 54.38% 

You can do the math just as easily as I can. 

Keith’s Investing Tip: Beating Wall Street at their own game isn’t particularly difficult over time but you must learn to think like a wolf, not like the unsuspecting sheep who get lured in by the headlines. Then, use simple, effective tactics that take away Wall Street’s advantage by making you harder to separate from your money. 

4 – The markets are constantly making new highs 

Most aspiring market mavericks have an uncanny knack for doing exactly the wrong thing at precisely the worst possible moment - meaning they buy or sell at times that inflict the greatest amount of financial damage on themselves. Not surprisingly, many of ‘em get all bent outta shape whenever there’s a concerted round of selling. 

Here’s the thing. 

The markets are constantly making new highs ... that’s how they work. 

Moreover, there is a very powerful upside bias over time because of the constantly growing amount of money chasing fewer and fewer quality companies. 

Let this sink in. 

The S&P 500 has spent 83% of the time at or within 10% of new all-time highs since 1927. What's more, it’s achieved roughly 1 new high a month, some 1300 new highs over the past century. 

MyPOV: Learning to face down fear makes you an unstoppable investor. Don't get me wrong. I know it’s not easy and I will never pretend that’s the case. But it’s important you try and that you take the data I share with you to heart. You got this! 

5 – Scared money never makes money 

Wall Street has spent millions learning how to push your buttons and play to your emotions. 

It’s not personal, it’s their job. 

Keep your emotions out of the equation and days like this – with a ton of red on the screen – won’t bother you much. If at all. 

Look at all the blue. 

And smile. 

Bottom Line 

Investing in optimism beats cowering in pessimism any day of the week. 😊 

Now if you’ll excuse me, I’ve got a few stocks I’d like to snap up and some money I’d like to put to work – and yes - in many of the great names we talk about frequently. 

Starting with tech. 

As always, MAKE it a great day. 

You got this – I promise! 

Keith 😊