Want to Profit in This Crazy Market? Try "KISS"

 

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Want to Profit in This Crazy Market? Try "KISS"

 

I'm a golf junkie.

It's true...

If the stock market isn't open, I'm probably hitting the links with my now teenage son (He recently turned 13-years old).

Here the two of us are at a recent golf outing.

Now let me tell you that I've been around the game of golf since before I was a teenager. I've played competitive golf in my younger years and was recruited by several prominent collegiate golf programs.

Today, I'm more of a recreational golfer.

Now don't get me wrong.  When I'm playing golf, I play to win. Even when I'm playing with my son, it's game on!

And don't let his size fool you because this kid has got some serious talent and a mean short game.  It's only a matter of time before that growth spurt kicks-in.

Anyway, a couple of weeks ago I was playing a round of golf and was really struggling to find my swing.

I was hooking it to the left.

Then, I found myself slicing it to the right.

I was constantly tinkering with my swing with a million thoughts running through my mind.

When I got up to the next tee box, I really didn't have a clue where it was going.

And wouldn't you know it, this time it was a "double-cross"…left and further left. yikes!

By the end of the round I felt dejected and my score showed it.

I lost the match (and $10) to my son.

After some reflection on my round and a few adult beverages to dull the pain, I realized what I was doing wrong.

It really had nothing to do with my swing at all.  After playing this game for nearly 40 years, my swing is fundamentally sound.

It had more to do with my thought process.

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You see, I had so many things running through my mind that it completely ruined one of the most important traits of a great golfer.

And that's tempo.

Instead of trusting my swing and allowing it to flow, I became distracted with all the adjustments I was making and overanalyzing as to why I wasn't hitting the ball to my intended target.

So this past weekend I was hell bent for redemption and eager to get my $10 back.

During my warm up, I cleared mind and decided to focus on just ONE thought and maintain it throughout the entire round and nothing else.

In other words, I was going to apply the KISS strategy…"Keep It Simple Stupid".

In today's market landscape, it's easy for investors to get distracted with everything that's going on.

There's the pandemic virus…

…the economic recession… record high unemployment… earnings contraction… zero interest rates… dozens of stimulus programs… extreme volatility… social disorder… mass protest… and more.

So you can see how it's easy for investors to fall into the trap of "analysis paralysis."

One thing you can do to navigate this type of market environment is to clear your mind and "Keep it Simple."

In other words, focus on the long-term strength following near-term weakness.

That's it!

If you simply let price serve as a guide and focus on the stocks that possess strong traits of technical strength that reside in the strongest segments of the market, you'll be light years ahead of most ordinary investors.

You'll clearly see that the way forward is to embrace near-term volatility as an investment opportunity.

Last Thursday, the Dow Jones Industrial Average fell 1,861 points or -7%.  It was the worst day for the Dow since March 13th during the height of the coronavirus pandemic panic.

This big selloff comes after the stock market just went on the best 50-day run in the history of the financial markets.

So you can imagine all the wild thoughts running through the minds of investors trying to make sense of it all.

But those that maintained that one single thought were almost certainly the ones that took advantage of the near-term weakness.

The Dow Jones Industrial Average is still -13% below the February highs.

But there are segments of the markets that are at or above their previous record highs.

The broad Technology sector is one of those groups that continues to outperform.

And within Technology, you'll find that Internet is one of the strongest sub-groups.

For those investors looking for that one thought, think internet stocks.

Take the First Trust Dow Jones Internet Index Fund (FDN) as an example.

This is a simple way for investors to gain passive exposure to a basket of internet stocks. That's "keeping it simple", wouldn't you say?

This exchange traded fund has eclipsed its previous February highs. So any near-term weakness could be an opportunity to buy and accumulate FDN.

Those that want a more granular exposure to the Internet sector could look to buy individual stocks that possess strong traits of relative strength.

In Sector Prophets Pro, our data analytics product, it's a simple process to identify high quality investment ideas.

We'll share three of them with you today…

  • Etsy Inc. (ETSY)
  • Bilibili Inc. (BILI)
  • Overstock.com Inc. (OSTK)

All three of these internet stocks are outperforming the stock market and their sector peers on a longer-term relative basis.

Investing in securities that possess positive relative strength traits increases the odds of generating superior returns. Think of it as adding that magical tempo to your portfolio.

As for my golf match with my son this past week. Well, let's just say that the KISS worked out very well.

I found my tempo once again, and won my $10 back.

And speaking of keeping it simple...

Nest Thursday (June 25th) my friend and colleague Chris Rowe will reveal a simple trading strategy that you'll have to see to believe.

It lets you pull cash out of your positions while staying in them. (No, not dividends...)

What's great about this method is that as you take cash out of the position, your risk steadily dwindles -- sometimes all the way down to zero.

Chris' event is FREE and you can save a seat by clicking here now.

Until next time!

CostasBocelliSig
Costas Bocelli
True Market Insiders


 

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"I have made more money in a shorter time than I thought possible."

Go here to find out how you could turn $930 into $15,866


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