Investor's Edge with Gary Kaltbaum - Pullback Time? [11.15.2023 w. Adam Sarhan]

Episode Date: November 15, 2023

Investor's Edge: Adam Sarhan filling in for Gary KaltbaumBOOK: Psychological Analysis by Adam Sarhanhttps://www.amazon.com/Psychological-Analysis-Rationally-Markets-Trading/dp/1119282047garyK.com convictionleaders.com

Guys, it's no use putting it off. The best time for an underwear refresh is now. Tommy John underwear is designed for a perfect fit that stays put all day. Their zero-chafe thanks to four times more stretch than competing brands. And their innovative horizontal quick-draw fly is a game changer. With over 30 million pairs sold, there are thousands of men out there more comfortable than you. Don't settle for less. Go to Tommyjohn.com today for 25% off your first order with Code Comfort.

That's Tommyjohn.com, code comfort. Tommy John. Comfort perfected. Investor's Edge with Gary Coltbaum. Straight talk about you and your money. Now from the BizTalk Studios, here is Gary Cultbaum. And welcome everyone to Investors Edge. I'm Adam Sarhan in for Gary Kay, who's out today, doing a fantastic thing, which he does every year for Thanksgiving.

So I thought some just massive, massive blessing and sending a lot of love to Gary and everything that he does, which is absolutely. fantastic. So today is Wednesday, November 15, 2023. We've got a great show for you tonight. We want to thank you very much for being here. Before we dive into the show, just give you some housekeeping points in between. And just as a quick reminder, if you don't get this show in your city, you can go to GaryK.com. You can listen live or archive. We're live Monday through Friday, 6 to 7 p.m. Eastern. Also at GaryK.com, you can follow Gary on Twitter by just pressing the button or on X now instead of Twitter, whatever you want to call it.

You can also subscribe to Gary's morning notes for free to get them sent directly to your inbox. You may email Gary, ask about his money management services, read the rest of his commentary. Or for those of you that want more, he posts on Convictionleaders.com several times a day. That's his premium website where he gives daily webcasts, in-depth market webcasts. He shows you what he sees in real time. He gives you a lot of commentary, pre-market report right after the open. It's a fantastic, several times throughout the day, and then a webcast typically at night after the close. It's a really, really good service.

Convictionleaders.com. So that being said, let's dive right in. What's going on in the market? Well, what's going on in the market is we had a really big run for the last several weeks, really all month, since the beginning of November. And it started the last few days of October, but it really kicked into gear on that big November 1st, fall through day, which was the day that the Federal Reserve came out and shifted their stance from one where, hey, we're not sure we might continue to raise rates and all that fun stuff, to one where they hinted that the rate hikes are pretty much over.

Now, that sparked a big rally. The market's a forward-looking mechanism. And what that means is it tends to look forward to the right of the chart. So I have a book. It was number one on Amazon. If anybody's interested, you can go to have a book. Amazon.com and get it. It's called psychological analysis. It's a pretty name I know. But the whole idea is that fundamental and technical analysis are not enough to beat the market. That's my thought

at least. And if it was, everybody would own a few islands in the Caribbean. So clearly there's something else there. And that's psychology, right? This upgrade the user. And that folks to me is the is the critical ingredient. For years, you know, I never, there's nothing wrong with the market. There's nothing wrong with the economy. It's me. How come I'm not a billionaire? It's me, right? So, okay, the more I can upgrade the user, the better I can get and more successful I become. That's more or less the premise, teaches you how to make rational decisions, not emotional ones, so on and so forth. In it, I share with you pretty much everything I've learned, in which I'll take some time today and talk about, because Gary's done a really good job on

the show for nailing it for you, keeping you out of harm's way from that July, August, September, October sell-off and really getting you back in gear with the market throughout the month of November. And today what I want to do is just talk more timeless lessons and share with you some broad strokes on things that you can do to give yourself a slight edge and help you make better decisions, teach you how to make rational, not emotional decisions. And then, of course, talk about the market and some stocks and all that fun stuff. So in the book, one of the things, one of the core concepts that I've learned is why do most people miss it or it can't beat the market or what is it? I bang my head against the wall, so to speak, for years. Finally, I figured it out.

The market's a forward-looking mechanism. I say in the book, it looks to the right of the chart, meaning it's looking forward, but most people are looking backward. So, for example, yesterday we We had a huge rally on Wall Street sparked by CPI, the consumer price index. Inflation has come down a lot. This time last year it was around 7% and now it's around 3%. All right. The Fed wants it near two. Some parts of the country, New England, it's down around 2%, and some other areas it's come down a lot.

But it's trending in the right direction. And then today we saw the producer price index or the wholesale prices come down as well for the lowest level in a few years. Okay, great. But that tells us what already happened. The big earnings report, enter any stock you want. By the time that earnings announcement is released, it's all its news. Well, the stock gapped up or it gaps down. It's important.

It matters. Yes, absolutely it does. But what really matters is going forward, right? So you can look at a stock like meta, for example, Facebook or Microsoft. Meta is META. Microsoft is MSFT. And they both fell after reporting. earnings. Okay, now they're back up. All right. You can have the exact opposite happen where

stock gaps up and then next thing you know a few weeks later it's it's down below where it was before the earnings. So what does all that mean? The markets are forward-looking mechanism. It's really important to understand the market's an infinite game, so to speak. It's an infinite has an infinite life. So it's a different mentality when you come looking at. at the markets. It's a different mentality saying, oh, well, this happened. I can't believe this stock's going up. The market's looking forward, right? So the market's discounting Fed rate hikes going forward. Even though the Fed could still raise rates, but the market's looking forward, three, six, nine, twelve months down the road. So that's really an important thing to

keep in mind. That's one. Look to the right of the chart. Two, when you ask your yourself, when you make investments, are you early or are you late to the party? So I have young kids and as Gary says, hug the kids, no question. Single book, best piece of advice ever, right? Make sure you're there, you're present and with your significant other and yourself and be kind to yourself as well. You know, we have a tendency to beat ourselves up and it's just not a losing trade. But anyway, get back to it. It's ask you know, when you're looking at, when you're looking at the market and you're asking yourself, hey, what is it that I'm looking to accomplish? What are my goals? And when you get to a party, and I said, I have young kids, they go to a party,

you know, you don't want to be late to a party. You don't want to be too early either. We had a birthday party. Someone showed up two hours early. What are you doing? No, it's a kid, it's a five-year-old birthday party. No, I don't need any extra help, right? So, and you don't want to show up two hours after the party's over. Same thing with the market. The market just has to have. The market just a huge rally. And if you missed it, that's okay. There's always another chance with an infinite game, right? The market pauses, it digests, it consolidates, and then it breaks out and goes up again, or it'll roll over and go down. But keep things real simple. And ask yourself, am I early or am I late? One of the tendencies of really powerful, I mean, humans are driven

by emotions, right? So there's two major emotions on Wall Street. There's many more, but two major ones are fear and greed. FOMO was fear of missing out. And fear is a really strong driving force. Period. Full stuff. It drives behavior. It drives people nuts, but it's a really powerful force. And people have FOMO. Oh my God, the market's up X percent this year or in the last few weeks or however you want to work. I'm not up that much. I need to go by now after a big move up. I'm not saying telling you what to do. there's no investment by giving, everything's general informational purposes, so on and so forth. All I'm saying is just ask yourself, am I early or my late? If we just had a huge explosive rally, be very, very careful or think twice or three times

or four times about when it is you're entering. Am I early or my late? Remember, extended markets can get more extended. Sure, they can keep going up. But it's a business of probabilities. It's a game of probabilities. What's most likely to happen? Is it going to shoot up again or is it going to pause and digest for a little bit or, you know, consolidate a little bit or even pullback?

So the title of today's show is pullback time. There's two ways to analyze a pullback. One is, is it shallow in size for small percent decline? And then scope, two. How long does it last? Does it drag out for six years or six months or six weeks or six hours or six minutes? right? So there's time and price. Those are the two elements. Healthy pullbacks are shallow in size and scope. They're small percent declines. Go down two, three percent, four or five percent,

one or two percent, and they last a few days or a few weeks and then bam, you're off to the races again. That's a healthy digestion, a healthy consolidation, a healthy pullback. An unhealthy one would be where you see it fall off the cliff. And you've seen this before in 2022. a lot of examples. Or even look at the Russell 2000, the IWM, or look at the microcap index, the IWC for most of July through October period, where that was an unhealthy pullback. And you saw a lot of damage in those areas.

Even the midcaps, the MDY, underperform big time. And it's still underperforming. So as we go forward, ask yourself, am I early? Am I late? That's huge. And you don't want to be too early. and you don't want to be too late. Timing, folks, is really important in life.

Think about the guy who meets the girl, the proverbial guy and girl at the bar, hits it off, there's spark, there's chemistry. Right away, guy just meets her. Hey, you want to get married? Probably not a good idea. Most likely she's going to say no. Right?

Now, if he dates her for, I don't know, six months, 12 months, 18 months, 24 months, some decent amount of time, she might say yes. So timing is really, really important. Up next, we're going to talk a lot more. We've got some stocks and a whole lot more. I'm Adam Sarnhan. This is a one and only Investors Edge.

Hi, I'm Gary Kalbaum, hosted a nationally syndicated radio show Investors Edge. We're not just handsome radio people. We manage investors money for a living, specializing in fee-based discretionary money management. No big commissions, just a fee on the assets that's managed. We also provide a full range of personalized services, including retirement planning, fixed income, and educational needs, all to assist you in achieving your financial goals. understanding not all individuals have the same needs,

we'll carefully evaluate your personal goals to determine a proper investment strategy. If your current approach to investing is not getting you to where you would like to be, call us to make an appointment for a complimentary portfolio review. The number to call is 888-4-2-5-59. That's 8-8-5-5-9. That's 888-4-2-2-5-9.

Investment advisory services offered through Call Bomb Capital Management Guys, it's no use putting it off. The best time for an underwear refresh is now. Tommy John underwear is designed

for a perfect fit that stays put all day. Their zero-chafe thanks to four times more stretch than competing brands and their innovative horizontal quick-draw fly is a game changer.

With over 30 million pairs sold there are thousands of men out there more comfortable than you. Don't settle for less. Go to Tommyjohn.com today for 25% off your first order with code comfort. That's Tommyjohn.com code comfort. Tommy John, comfort perfected. This message is brought to you by the Capital One Venture X card. Venture X offers

the premium benefits you expect, like a $300 annual Capital One travel credit for less than you expect. Elevate your earn with unlimited double miles on every purchase, bringing you one step closer to your next dream destination. Plus, enjoy access to over 1,000 airport lounges worldwide. The Capital One Venture X card. What's in your wallet? Terms apply. Lounge access is subject to change. See Capital One.com for details. This episode is brought to you by Spreaker. The platform responsible for a rapidly spreading condition known as podcast brain. Symptoms include buying microphones you don't need, explaining RSS feeds to confused relatives, and saying things like, sorry, I can't talk right now. I'm editing audio. If this sounds familiar,

you're probably already a podcaster. The good news is Spreaker makes the whole process simple. You record your show, upload it once, and Spreaker distributes it everywhere people listen. Apple Podcasts, Spotify, and about a dozen apps your cousin swears are the next big thing. Even better, Spreaker helps you monetize your show with ads, meaning your podcast might someday pay for, well, more microphones. Start your show today at spreeker.com. Sprinker, because if you're going to talk to yourself for an hour, you might as well publish it. It's time to switch on the integrator units and get the brain cells working. You're listening to.

Hey, this promises to be fun. Investors Edge. The last bastion of quality programming. With Gary Cult Bomb. It doesn't get better than this. And welcome once again to Investor's Edge. I'm Adam Sarhan in for Gary Kay, who's out today. In case you're just joining us or missed any part of the show, you can go to GaryK.com, rewind, fast forward, pause, listen on any device 24-7.

I know I tend to go fast. I have a lot to cover and a short amount of time. So I'll do my best to, you know, if you miss anything, by all means, please just go to GaryKK.com and you can pause or wind, fast forward, take notes. And I try to include the tickers whenever possible, the stock tickers or the ETF tickers so you can pull them up at home and check them on your own to see if I'm talking about specific levels, support, resistance. You can follow along and see that as well. because, you know, this give you the fish. It's one thing, but really the passion here to teach you how to fish and share with you what I've learned with Gary. What he does it all day, every day, that it's really, really a big component. So let's talk about support and resistance. In case you're not familiar, support is considered a floor in the room and resistance is considered a ceiling. So, for example, if you have a stock goes sideways for six months between, I don't know, 25 and 30 thereabouts, 25 would be support and 30 would be resistance. Simple enough. Okay, beautiful. Now all of a sudden one day you see that it just blasts off and goes right above resistance on very heavy volume. That'd be a very bullish sign. Why? Because

something changed. Think of it as the Libra scale, right? There's a weight from the right left. Something a seesaw something shifted majorly. Okay. And then if it keeps running and keeps going then by all means it's going to go higher and higher and higher. If it doesn't, hey, you roll over, no harm, no foul. So, and sometimes breakouts, they fail. You go above 30, 32, 33, and then bam, comes crashing down back to the mid-20s. So be it, such as life. In fact, most breakouts fail, but the ones that don't go on to do very, some of them go on to do very, very well. So that's a concept of support and resistance. The QQQQ, which the NASDAQ 100, is the leading index this year. I love leadership. I'm a sucker for it. Whatever word you want to use, it's my passion.

I just want stocks that are going up. Okay, simple. So the QQ support since July has been around 350. It broke it briefly at the end of October, went down to 342, got right back above it. And resistance has been 388, which is July's high. Today's high, and again, this is the 15th of November. So today's high so far was 387.75. The high from July, and I can't make this up, was 387.98. So again, 387.98. Today's high so far is 387. Well, 387.75. So when again, it's, it's a spirit of the law, not the letter of the law. It's not an exact science. Adam, well, 387.98 is not the same as 387.8. 7.75. Yeah, I know. I used to be a stick with that. It used to be me. It's like, hey, well, it's not exactly. It's a spirit of a law. It's a zone. It's an area. It's fluid. That's what I've, 20 plus years of experience has taught me more than 20s. I've been doing this since the 90s has taught me a few decades now. It's a spirit of a law, not the letter of the law. So when you have the market, the QQQQQ, I focus on that because that's the leading. index. It's the strongest one out of all the indices this year. It's where the big cap tech

reside. And big cap tech, the Magnificent 7, or even the semiconductors, if you go broader, tech stocks, specifically NASDAQ 100, it's the strongest index out there. So I'm looking at leadership. The weakest are the microcaps, the IWC. The second weakest are the IWM, the small caps, and then the midcaps, MDY, and then so on and so forth. But the QQQQ, the NASDAQ 100, think of resistance, right? Between 25 and 30 was an example I gave you. This one was between 350-ish and 388, just to round up. Okay, well, guess where we are? We're right near resistance. And you pretty much went straight up. I think we've had two down months, sorry, two down days this month. That's it. Two down days. Most likely, again, anything is possible,

but I focus on what is probable. Why? Because otherwise, you wouldn't do anything. You'd never leave your house. I can cross the street. If I look both ways right and left, most likely I'll be okay. But there is a chance. I trip and fall and a car comes out of nowhere and God forbid, right? I'm going to go on an airplane, but I'm still going to cross the street. I'm going to go on an airplane because most likely airplane's going to take off, airplane's going to land. Now, could something go wrong? Of course. There's a probability of that happening, but it's so small. I think I have a better chance getting into a car accident, then a plane. So you follow, I'm still, I'm going to get in the car. You have to live life, but you measure it in probabilities. Now, am I going to blind myself and go on

the highway and drive from, you know, New York to California? No. Absolutely not. But it's, again, making intelligent decisions based on probabilities. So when you see the market have a huge rally from support, a little below support, actually, to right around resistance, pretty much going straight up, that's extended. Now, could it keep going up? Absolutely. But a probability, you know, if you play the odds, most likely it's going to consolidate or digest or pull back.

Again, pullback time. That's where my thought process is. And then let's measure, gauge the health of that pullback, if and when it comes. So I had a question come in today from a fine-leaning stocks member, And he goes, Adam, what do I do? I missed this rally. I missed it.

He didn't participate, even though you told me to, but that's fine. And what do I do now? Do I wait? Or do I get in? So I asked them. I said, okay, well, if you wait, what's the worst that happens? The market needs to keep going up without you. And that's one side.

And you wait, what's the best thing that happens? The market pulls back and you get a better risk adjustment. entry. Which scenario do you want, sir? That was it. Notice, I didn't say anything. I just ask the question. Let him decide. And he said, oh, no, 100% I much rather be out. And then another question, great question to ask is, do you rather be out wishing you're in or in wishing you're out? He's like, no, no, no, no, I made one mistake by missing the rally. I don't want to compound the mistake and chase it now and buy up here and get really top heavy. And if it goes higher without me, so it'll be it. Great. He answers his own question.

I helped him. I coached him, but he was able to answer his own question. Notice, pause and rewind that part, right? Ask yourself, it's okay. You're going to miss things. And that's part of the self-talk I was talking about earlier, about, you know, hugging yourself and hugging your children. It's not just the children and your wife and everyone else around you. It's be kind to yourself because that's so important, especially in this business. I'm up 10%. The market's up 12. I'm up 10%. The market's up 5%. I'm beating the market, but I should be, and I beat myself up because I'm not up 20 or up 50. Or I'm up 80%. I should be, I'm really upset because I should be up 100. I've seen, I've experienced many of that and I've been through all of that. And I've seen others that have

had similar situations. Gratitude, attitude of gratitude, be grateful for what you have. And if you miss something, it's okay. Think of it as a trade. Every decision is a trade. Just about. Risk or war. Win, win, lose. That's it. Those are the two sides, the two outcomes of every decision you're going to make. Okay. One, if I do this, I make this decision and it doesn't work, what's the worst that's going to happen? Am I okay with that? Just like a trade. Before I enter, I know where I'm going to exit and how much I'm going to risk if I'm wrong. There's a time. Up next, we've got a lot more to discuss. I'm Adam Sarhan, and this is the one and only Investor's Edge. Guys, it's no use putting it off. The best time for an underwear refresh is.

now. Tommy John underwear is designed for a perfect fit that stays put all day. Their zero-chafe thanks to four times more stretch than competing brands and their innovative horizontal quick draw fly is a game changer. With over 30 million pairs sold, there are thousands of men out there more comfortable than you. Don't settle for less. Go to Tommyjohn.com today for 25% off your first order with code comfort. That's Tommyjohn.com code comfort. Tommy John. Comfort perfected. This message is brought to you by the Capital One Venture X card. Venture X offers the premium benefits you expect, like a $300 annual Capital One travel credit for less than you expect. Elevate your earn with unlimited double miles on every purchase, bringing you one step closer to your next dream destination.

Plus, enjoy access to over 1,000 airport lounges worldwide. The Capital One Venture X card. What's in your wallet? Terms apply. Lounge access is subject to change. See Capital One.com for details. This episode is brought to you by Spreaker. The platform responsible for a rapidly spreading condition known as podcast brain.

Symptoms include buying microphones you don't need, explaining RSS feeds to confused relatives, and saying things like, sorry, I can't talk right now, I'm editing audio. If this sounds familiar, you're probably already a podcaster. The good news is Spreaker makes the whole process simple. You record your show, upload it once, and Spreaker distributes it everywhere people listen, Apple Podcasts, Spotify, and about a dozen apps your cousin's swears are the next big thing. Even better, Spreaker helps you monetize your show with ads, meaning your podcast might someday pay for, well, more microphones.

Start your show today at spreeker.com. Spreaker, because if you're going to talk to yourself for an hour, you might as well publish it. You're listening to. America is talking. Investors Edge. He's got to be pleased with that. The crowd is just on its feet. here, he's a Cinderella boy.

With Gary Colbomb. It comes highly recommended. You're going to feel better if you talk to him. And welcome once again to Investors Edge. I'm Adam Sarhan in for Gary Kay, who's out today. Case you're just joining us or missed any part of the show, you can pause, rewind, fast forward, go back to GaryK.com and listen to everything. All the archives are available 24-7 on any device. So we spoke about just a recap here, the beginning part of the show of some really important

timeless lessons when you think about the market. The big lesson here, the topic of the title of today's show is pullback time, question mark, meaning odds are, and then we spoke about pullback time and not chasing and having discipline and then how to make better decisions. And I spoke about decisions as trades. That's how I internalize just about every decision I make. there's an element of risk there's an element of reward

do I want to cross the proverbial street yes or no sure could I get hit by a bus possibly but what are the odds and if I look both ways and I wait for the signal and so on and so forth sure I'll take that trade and I'll cross the street if it helps me get to my destination faster will I blindfold myself

and cross a busy street in the middle of the day no right so again risk reward look at the trade so in trading, another timeless lesson I share with in the book, it's really important to have structure. And one thing I've learned from studying Gary and some of the best successful,

most successful investors in history, I've got a show called Smart Money Circle where I interview, CEOs of publicly traded companies, large money managers, all for timeless advice. And it's free. You can go check it out if you want. And I've learned after doing over 130 episodes, I think I'm at now, or 125 somewhere in that area. and success doesn't happen by accident.

Nobody gets a six-pack by accident. Nobody becomes a billionaire by accident that I know of at least. But if you do certain things, you follow the rules. Of the game, eat healthy. Let's talk about health, because everyone can understand with that or relate with it. You eat healthy. You do the sit-ups. You exercise.

You sweat. You sleep. Guess what? Your body's going to react. acting over time, you're going to get a flatter stomach, you're going to lose the weight, eventually, hopefully it depends on how many setups you do, you get the six-pack or the flat stomach, right? I asked a trainer one time, he goes, I said, how many setups do to get a six-pack? He goes, as many as it takes. I thought that was a great answer. All right, same with the market,

or same with decisions. Before I enter any position, it's really, really important for me to measure the risk. Because actually some guy in the show told me one time he goes, Adam, you and I, we're not buying and selling stocks. I said, really? What are we doing? Because we're buying and selling risk. And I thought that was absolutely brilliant. And I mean next level brilliant. Because it's so true. We're buying and selling risk. I'm risking a dollar, hopefully, to make at least one, if not two, or four or five, ten dollars. Think about that. You're buying Apple, Tesla, Microsoft, Navidia, meta, Facebook, you know, Google, Microsoft, Magnificent 7, Amazon, Adobe,

it doesn't matter. It's risk. Versus what? Reward. So before I enter anything, I want to ask myself three questions. And these are all outlined in my book, by the way. Again, psychological analysis you can get on Amazon or wherever books are sold. Barnes & Noble anywhere you want. And if you like it, please leave a nice review. So, one, where am I going to enter?

Simple. Question. Where am I going to enter? Set number two, where am I going to exit if I'm wrong? And number three, how much am I going to risk if I'm wrong? Literally, it's just that simple. And you can do that over and over and over and over again on anything you buy. For me, I don't care what it is.

If it's liquid and I can trade it, if it's a commodity of stock, a company, currency. It doesn't make a difference. It's all the same thing. It's risk. Versus what reward? Think about that. Before you enter, you're planning your entry, your exit, and your risk. Ben Franklin has a great line. I'm going to paraphrase it. And I'll give you the quote. He goes, well, my version of it is either you're prepared to win or you're prepared to fail. It's just that simple. He doesn't say that. He says it much more eloquently and much better. By failing to prepare is what he says. You're preparing to do what? fail. Again, by failing to prepare, you're preparing to fail. It is brilliant. Next level genius. So with me in the market, one of the great books out there, it's Nicholas Darvers wrote

how I made $2 million in the stock market. And in it he talks about, he was a ballroom dancer and he was back in the 60s and 70s or even, you know, decade before the internet. And he wouldn't have access to real-time quotes. His broker would send. him the quotes and barons and once a week and he'd fed you know telegram back and he did very very well and then he came back to new york and he traded in the office with the broker and he lost all his money or lost a bunch of money and he couldn't believe it he left went to paris and did extremely well he stayed at the plaza hotel in new york and got you know got crushed he left with the plaza and so he went to paris and then started doing very very well and he made two million

dollars trading stocks back in the 60s and 70s or 50s whenever he was doing it and that was guess what like next level of money back then. Still is massive money now, but think about how much bigger it was way back when. And the way he did it was by planning ahead. He had something called Darvus boxes, which are flat bases or rectangle bases, where he identified support and resistance.

He said, okay, if it breaks out above resistance, I want to buy, and here's what I'm going to sell. Think of it as binary. You're either above resistance or you're not. And if it stays above resistance, I'll let the thing run until it breaks down and gives me a reason to sell it. He did that remotely with no internet, no iPhone, no text messages for years and did very, very well. Because he planned ahead.

He forced it. And when he went into the market and he was jumping up and down and the emotions were flying and people are screaming and yelling and phones are up and, you know, all that stuff, guess what? Got crushed. I do that with my work. I plan on the weekends, nights. When the market's closed and I do my best work. okay before the market even opens

I know where I'm going to enter where I'm going to exit and how much I'm going to risk if I'm wrong why I'm preparing to win preparing ahead now I might miss something sure absolutely guess what that's okay you can't catch them all

the proverbial high school kid who's in the dance the high school dance he wants to go kiss all the girls in the room you can't do that you don't have to just need one you'd be very very happy one big stock two big stocks a year you do extremely well if you get in and you ride them

and you give them time. You know, one guy gave me a good line too. He goes, you're going to be patient with your winners and impatient with your losers. It's a great, great line. So again, I want to share with your folks. It's timeless advice, things that can help you improve your performance, can help you improve your game, can help you improve your thought process. Because ultimately, all this is, it's a business of idea plus execution. The smarter your ideas, the smarter your thoughts, the better your execution, the better you're going to do over time.

Or at least for most people. Not you specifically, I don't know who you are, but generally speaking. That's it. I mean, that's upgrade the user. You know, back, I bought a printer. It doesn't work. I called the 800 number HP. Hey, the printer's not working.

The first question I asked is it plugged in? Oh, no, it's not plugged in. I plug it in. Everything's fine. Guess what? Nothing's wrong with the printer. It's user error. Story in my life.

Right? So, okay, upgrade the, I've got one job, learn. One job, upgrade the user. This is timeless. Aristotle said it great, all the way back went in ancient Greece. I know I don't know. So I've got one job to learn. And that became, that's my superpower. Somebody told me the other day, he goes, Adam, that's your superpower.

Say great, thanks. Love to learn. And you go into it with humility. That's how the market does. It's a tremendously humbling environment. But your biggest competition is your former self. It's another piece which we'll talk about. It's called arbitrage and intellectual arbitrage and all this kind of fun stuff,

which fancy terms, but it just basically means you want to become smarter today than you were yesterday and smarter tomorrow than you are today. So a big part of what I do, it's upgrade the user and learn how to make smarter decisions, smart decisions and smarter decisions. The smarter the better. So now that we've got giving you some good framework, hopefully to help you know, you can take this and use it for the rest of time. Because no matter whether it's 500 years now or 50 years ago or 50 years in the future or five minutes from now or five days from now, same thing. Where am I going to enter?

Where am I going to exit? How much am I going to risk if I'm wrong? Basics, right? So the market's up near resistance for the cues. So it's going to be one of two things happens. Either it consolidates and slash pulls back or it keeps going higher. Probability-wise, most likely it's going to pull back a little bit or digest at least go sideways. See what happens.

We're open-minded. Up next, we've got a lot more to cover. I'm Adam Sarhan, and this is the one and only Investor's Edge. Guys, it's no use putting it off. The best time for an underwear refresh is now. Tommy John underwear is designed for a perfect fit that stays put all day. Their zero-chafe thanks to four times more stretch than competing brands, and their innovative horizontal quick-draw fly is a game-changer.

With over 30 million pairs sold, there are thousands of men out there more comfortable than you. Don't settle for less. Go to Tommyjohn.com today for 25% off your first order with Code Comfort. That's Tommyjohn.com code comfort. Tommy John. Comfort perfected. This message is brought to you by the Capital One Venture X card. Venture X offers the premium benefits you expect. Like a $300 annual Capital One travel credit for less than you expect.

Elevate your earn with unlimited double miles on every purchase, bringing you one step closer to your next dream destination. Plus, enjoy access to over 1,000 airport lounges worldwide. The Capital One Venture X card. What's in your wallet? Terms apply, lounge access is subject to change. See Capital One.com for details. This episode is brought to you by Spreker.

The platform responsible for a rapidly spreading condition known as podcast brain. Symptoms include buying microphones you don't need, explaining RSS feeds to confused relatives, and saying things like, sorry, I can't talk right now, I'm editing audio. If this sounds familiar, you're probably already a podcaster. The good news is Spreaker makes the whole process simple. You record your show, upload it once, and Spreaker distributes it everywhere people listen, Apple Podcasts, Spotify, and about a dozen apps your cousin's swears are the next big thing. Even better, Spreaker helps you monetize your show with ads, meaning your podcast,

might someday pay for, well, more microphones. Start your show today at spreeker.com. Sprinker, because if you're going to talk to yourself for an hour, you might as well publish it. You're listening to. What are we waiting for? Well, what are you waiting for? One, two, ready, go. Action!

Investors Edge with Gary Culpa. And welcome once again to Investor's Edge. I'm Adam Sarhan and for Gary Kaye who's out today doing a wonderful cause and doing a great great thing with this Thanksgiving dinner we spent most of the show going over some timeless lessons

some timeless principles there's a lot more but I did want to just share some of those with you because it's really important as you help give you the framework so you can put together your own investment philosophy, methodology, system, whatever word you want to use

describe it. So a few things here. We spoke about that arbitrage. I want to talk about that for a second. So arbitrage is a fancy word, which means you in Wall Street parlance. It means you take advantage of a discrepancy in price. So maybe oils up big, oil stocks are down big. Somebody's going to give, right? Either oil's going to come down or oil stocks are going to go up. So that's arbitrage. So I have a concept, well, two concepts. One is called time arbitrage. You're the one's intellectual arbitrage. Again, they're covered in the book. Intellectual arbitrage basically, means who's smarter? You today are you from 10 years ago? Hopefully you today. Well, okay, who's going to be smarter? You today are you 10 years from now? Hopefully, you 10 years from now.

That's intellectual arbitrage. That's one side of it. The other side of it is you want to outsmart or are the competition. You can't be smarter than everybody, but you can do your best to make intelligent decisions, respect risk. And then if you have the good framework in place, good habits over time, you're going to do well. That's the idea. Time arbitrage. Similar concept, a little different. Warren Buffett, I read his annual reports every year. He publishes him around May, and I like that stuff, so I end up doing that. All right, great.

In it, he gives all credit, just about all credit to the American tailwind. He goes, the last 50, 60 years, America's had phenomenal success. I'm very lucky to have participated and enjoyed the American tailwind. And you can just see it. Look at the country's GDP. Look at the country's earnings. look at the S&P 500, look at the NASDAQ 100, you just have tremendous mind-blowing gains decade over decade over decade. And that's the forest. Most people get caught up in the,

not even the trees, they look at the leaves in the trees. They look checking their phone every 30 seconds and they're looking at every tick and then they get what I call tickisitis. You ever, you know, get bronchitis or any other kind ofitis. It's typically not a good thing. So when someone stairs every single tick for every second, it tends to, not all people, but for most people, jumble, you know, scramble their brain, they make emotional, not rational decisions. So one of the things I've learned, and then they get in, they get out because it was a down tick or something, you know, down day even. One of the things I've learned, if you zoom out, look on a monthly chart, most days just don't matter. The NASDAQ 100, 2009 hit a low at 25. You're right, well, even 2008,

during that crash, you had a low, yeah, I guess it was right near 25 also. In 2002 was at 19. All right, you're now at 385. That's a massive move. This is the QQQ. You can just pull up on a monthly chart. You know, 408 was the high in 2021. You're now at 385.

Not that far from an all-time high. And you have a beautiful cup and handle pattern forming on a monthly chart, which is really bullish. If we break out of here, my goodness, we can go much, much higher. question becomes, I call it the Great American Tailwind. Buffett calls it the American Tailwind. Great. Okay.

What am I doing to participate in that Great American Tailwind? By allocating my portfolio accordingly. That's really powerful, and that's time arbitrage. That's a part of like the equation where it's like, oh, okay, hold on a second here. Every stock eventually needs to be sold. I get that, especially when it gets in trouble. You don't want to look at Tesla last year. I went from, I think it felt like 80 percent.

Amazon, meta, Facebook, a lot of these things too, had huge Netflix, which fell more than 50, 60% and just got crushed. Some of them recover, most don't. Okay. I get that. There's no right or wrong. All I want to do is gently bring it to your awareness, to your attention, to my attention, of what am I doing to participate in the Great American Tailwind?

Most people look at the leaves and the trees, the second, you know, every second, every tick. They miss the tree. Or they look at the tree. The tree could be a daily chart or even a weekly chart. Okay, you see the tree, but they missed the forest. So the time arbitrage component is just what am I doing to align myself with the Great American Tail Went? You know, there's an old adage on Wall Street that says, make the trend your friend. It's so powerful.

Not understood. By the way, not easy to do. Simple, but not easy. That's the next thing I want to share with you. Most things in life are simple but not easy. Well, let's talk about losing weight since we all can relate to that. It's calories in versus calories out, yet most people are overweight. All you've got to do is eat less than you burn on any given day, and over time you'll lose weight. Simple.

Not easy, but simple. Money. Most people are broke or don't live to their financial wherewithal or to the level that they should be, success that they should have, and should as air quotes, right? Because it's all subjective. Why? It's cash flow in versus cash flow out. Adam, I'm going to make more money.

No, you don't. I make a million dollars a year. I spend two. I'm negative one. I make $10 million a year. I spend $11. I lost. I'm negative.

You know, I'm negative. Meanwhile, I'm another guy who makes $50,000 a year. Spends $30,000 a year. He's positive. So, yeah, make more money, sure. But really focus on this cash flow out. If you live under your means, over time, compound interest, over time,

and you invest wisely, you'll become wealthy and successful. But most people don't have, A, don't have the patience, B, don't understand that. C are not able to control themselves because, quote, unquote, it feels good when you spend stuff, when you spend and you buy stuff. Getting simple, but not easy. A lot of the concepts in life, simple. At first, by the way, at first it's hard and then it becomes easy. Go ask somebody who's really in shape.

Hey, want to go eat a big ice cream sandwich or chocolate chip cookie or whatever? No, thanks. Because they know how hard it is to burn it off. But for most people, they review, you know, it's pain pleasure. I don't want to go into a whole other tangent here. But you think of it that way. It's simple. I'm going to add a little thing there.

At first, it's hard. And then after you develop the habit, it becomes easy. You're still going to get tempted, of course. But if you understand the basics and you look long-term thinking, the consequence of every decision, this consequence is a short-term consequences. If I eat a cookie, I get pleasure right now, short-term. Okay, great. But if I do that all day every day, long term, I got pain.

Right? All right. If I go to the gym, sweat, do the sit-ups. Most people associate pain with that. But long-term, if they do that, they're going to get a tremendous amount of pleasure. So always look at the consequences of the decisions that you make. And try to align yourself with the long-term time arbitrage, right? The great American tailwind.

Your life is phenomenal. It's the best time ever to be alive in human history. And it's getting better and better and better. So believe that's all the time that we have. We want to do like Gary says, make sure you go home, hug the children, hug yourself, be kind. Your greatest winners are in front of you. On that note, thank you all. It's been absolutely fantastic.

This has been Investors Edge with Gary Cult Bomb on BizTalk. To listen to past episodes or to get in contact with Gary, go to GaryK.com. That's GaryK.com. Guys, it's no use putting it off. The best time for an underwear refresh is now. Tommy John underwear is designed for a perfect fit that stays put all day. Their zero-chafe thanks to four times more stretch than competing brands. And their innovative horizontal quick-draw fly is a game changer.

With over 30 million pairs sold, there are thousands of men out there more comfortable than you. Don't settle for less. Go to Tommyjohn.com today for 25% off your first order with Code Comfort. That's Tommyjohn.com code comfort. Tommy John. Comfort perfected. This message is brought to you by the Capital One Venture X card. Venture X offers the premium benefits you expect, like a $300 annual Capital One travel credit for less than you expect.

Elevate your earn with unlimited double miles on every purchase, bringing you one step closer to your next dream destination. Plus, enjoy access to over 1,000 airport lounges worldwide. The Capital One Venture X card. What's in your wallet? Terms apply. Lounge access is subject to change. See Capital One.com for details.