This is The Takeaway from today’s Morning Brief, which you can sign up to receive in your inbox every morning along with:
There are two things that unleash my inner beast. Always have, likely always will.
First, being disrespected. And two, listening to lazy investing insight.
I can’t tell you how many times I’ve sat back and listened to investing “pros” tell me a stock market pullback is healthy. Ridiculous.
Since when is losing money a great thing? Nike (NKE) shed close to $13 billion in market cap this past week because of poor quarterly EPS guidance. How is that healthy for those who have been holding this stock through five years of relative underperformance while hoping for a turnaround?
It’s not.
In the same vein, I lost track 20 years ago of how many investing “pros” say to ignore stock market corrections and bear markets because the stock market tends to go up over time.
Are you kidding me?
Sure, stock prices may be higher 10 years from now, but by then, you may be dead. Sorry to be blunt, but it’s true. What happens in the here and now is really important and should not be ignored.
Why? Well, because it could be financially painful, as seen in the chart below from Keith Lerner at Truist. Yes, the long-term direction of the S&P 500 (^GSPC) is higher on this chart, but that overlooks all the periods of major pain.
Understand that the world around you is constantly changing, and that means the drivers of the stock market are constantly changing. Don’t stick your head in the sand because you hear some dope say stocks will be up 10 years from now because they always go up. If you need to pivot as new information on companies and the economy comes to light, you pivot and keep reassessing.
Investing your hard-earned money is just that: something you control for a desired outcome you are looking to achieve.
To that end…
I decided to take 10 minutes today and live in the moment and reflect on the many investing lessons I have learned over the past 23 years of my career.
The challenge I’m setting for myself this birthday weekend is to keep each lesson learned to 10 words or less without using AI. (Sorry, new Yahoo Scout AI, I love you, and I’ll be back your way shortly.) I really have 1,000-plus investing lessons, but I’m only going to drop 10 for time purposes. They’re in no order of significance.
Here we go — I hope these prove helpful in your wealth-building endeavors: