Cars blast past you at 90 mph, and others putter along at 45 mph. You’ve got two to four traffic-jamming accidents a day. And my wife loves telling the story of how she was once parked on the interstate for three hours because an RV caught fire!
Needless to say, no one’s ever learned to be a good driver by watching the crazy antics of other drivers (least of all in Florida).
In the same vein, no one I know has ever gotten rich by watching the financial news. Not only does it distract from the bigger picture, but it skimps on real, valuable information.
When it comes to watching the financial news, this is my personal philosophy:
“I glance… only because it takes too much effort to fight the urge. But then I quickly turn my focus back on the road ahead.”
The same could be said about driving on I-95 in Miami-Dade County. The only way to be a good, safe driver there is to follow a few simple rules:
Rule #1: Plot your course, then drive it.
Rule #2: Focus on the road ahead, little else.
Rule #3: Be defensive… so you can live to drive another day.
When it comes to the markets, investors can’t control what happens in China… or the Middle East… or anywhere, for that matter. And no amount of financial news will tell you what’s actually going to happen, let alone which investments you should be in through the saga.
Like an accident on the highway… financial news is just a distraction. Disciplined investors know to heed it, then move on. Just as it’s dangerous to focus on distractions while driving, choosing to focus on the ever-changing twists and turns of a financial storyline can be detrimental to your portfolio.
Instead of following those rabbit holes, I use data-driven statistics to hone in on high-probability investment opportunities – no matter what the headlines are saying.
Last year, one of my research studies showed that volatility spikes occur more frequently, and are of greater magnitudes, during June, July and August. Accordingly, I positioned Cycle 9 Alert readers in a play that would not only protect them from the summer’s volatility… but also give them a chance to profit from it. And that play ended up being our biggest winner – producing a net return of 165%!
Mind you, I had no clue which specific news headline might be the catalyst for a burst of volatility.
But it was within my control to use data-driven research to plot a course for Cycle 9 Alert readers – one that would protect them from the global market turmoil, regardless.
Adam O’Dell, CMT