lystn

Hey everyone, Kirk here again and welcome back to the daily call. On today’s call, we’re just going to talk quickly about this concept of confusing smart with a bull market. The old saying is… I don’t know if I get this exactly right, but I hear it often and it’s, “Don’t confuse being smart with a bull market.” That’s really fitting because I find a lot of times that people especially in this industry, especially in the trading industry, when everything is good and the skies are clear (if you will) and everything is up, up, up, up and away, then options trading gets a really bad rep. We get a really bad rep because it’s easy to be complacent and let’s face it, just lazy and invest in indexes or really, you don’t even have to invest at an index because you can invest in anything in a bull market and you’ll see your account go up. That to me is interesting because then, people start to act like they’re smart, like they did something smart by just actually just investing in those stocks. I’m not saying that you can‘t believe in the stock and want the stock to go up, but don’t confuse being a smart investor and a smart trader with a bull market because eventually, everything goes back down. It takes a long time for people to realize this, but eventually they do when we have market corrections and crashes like we had in the 2000s, early 2000s, then 2007-2008, then everyone looks really, really dumb. The analogy I would use to this is if you were back in 2006-2007 really and you saw people buying real estate hand over fist which I remember people doing this. It’s crazy. I remember people leveraging up to the hilt, everything was just literally, you would buy it, you would sit on the real estate. I was in the DC area at the time and DC area was hot market and so, people would buy real estate, literally let it sit empty for two months and then sell it for a huge profit. That is not necessarily the smartest thing to do. That worked and so, good for them that worked. You got lucky. You weren’t really smart. It wasn’t a strategic investment. It’s like running through a dynamite factory with a lit match. If you can get through there, it doesn’t mean it was the smartest thing in the world to do. It just means you got through there, you got lucky. I feel like that’s what a lot of people do in a bull market and these same people are going to be the same people who come back later on whenever the market corrects and we get a black swan event which will ultimately happen because they always do. When that event happens, these people are going to come back and they’re going to be the ones crying and complaining about the market going down and about how X, Y, Z affected them. It was the bank’s fault, it was the government’s fault, it was China’s fault, it was Russia’s fault, it was whoever like putting your scapegoat for whoever’s fault it was that the market went down and took all their value out of their account, but it was more or less their fault that they didn’t educate themselves in understanding how to generate income in different market scenarios. They were a one trick pony and one trick ponies get sent out to pasture sometimes. It’s just like you can only do the same thing when it works in that one little market scenario. I don’t know why I want to rant about this today or just talk about it, but I just feel like I see a lot more people just acting like they’re really, really smart in a bull market just because they invested in Tesla and Tesla went higher. That doesn’t mean it’s a smart investment. That doesn’t mean it’s a strategic investment. You just got lucky and luck can only last so long. Hopefully that helps out. As always, if you guys have any questions or comments, let me know. Until next time, happy trading!