InvestingWithBrandon

Retail investor: I take profits every time I'm up 25%. Lock it in, never go broke taking gains.
Me: Look at that 5 year chart. How many "25% moves" are on it?
Retail investor: A few... but they kept going after.
Me: Right. So every time you locked in 25%, the thing kept running & you were out. Then you paid taxes on the gain, so you need your next pick to work just to catch back up to taxes paid.
Retail investor: I mean I have to sell sometime.
Me: Do you? Here's what the wealthy actually do. They don't sell their best shares. Ever. They get their cash a different way.
Retail investor: Which i

HOW TO BUILD A CASHFLOW MACHINE WITH $200,000 in 2027:
(works at almost any size, just move the zeros)
$80k $VOO
$80k $Q
$40k high conviction companies
That base compounds on average 15% a year & NEVER gets sold. Not in a crash, not ever.
Then sell puts secured by that base. Not cash.
Every put has to pass all 5:
1. Company is below fair value TODAY
2. Real moat & pricing power
3. Profits growing for years
4. Strike 10% below current price
5. 1 year duration minimum
Premium hits the same day & buys more $VOO + $Q + Elite companies.
Bigger base secures bigger puts. Bigger puts pay more premium.

Retail investor: "AI is a bubble bro. This is 2000 all over again"
Me: What do you think the Nasdaq 100 was trading at in March 2000?
Retail investor: idk... like 30 times earnings?
Me: Around 100 times forward earnings
Retail investor: ok & now?
Me: About 19... Look at the chart below that shows both times.
Retail investor: wait that can’t be right
Me: It is. Back then you had companies with zero profits going public & doubling on day one. Today the biggest AI names are some of the most profitable businesses on the planet... & S&P 500 earnings are expected to grow 15%+ next year
Retail invest

I’m 90% confident we get a 15% correction in 2027
& I’m still bullish
Both can be true. New transformational technology always brings volatility. AI is the biggest one of our lifetime. It’s going to be bumpy
So here’s what nobody asks themselves... if you KNEW a 15% drop was coming at some point next year, would you still be selling weekly puts on hype stocks?
Buying calls that expire next month?
Sitting on margin, all in on 3 AI names?
That’s how people get forced out right before the recovery
I’m planning for it now. My puts go 1+ year out with breakevens 20-30% below the price on an already

Retail investor: Everything’s down. Is this a good time to buy LEAP calls?
Me: On what?
Retail investor: idk... whatever fell the most?
Me: That’s often backwards. The stuff that fell the most is usually the stuff that was the most expensive
Retail investor: so what then?
Me: I only buy 1+ year calls when 3 things line up. Great company. Below fair value. & the big four looks good... economy, interest rates, valuations, earnings growth.
Retail investor: anything like that right now?
Me: Nvidia trades around 17x next year’s earnings. Cheaper than the S&P. With better growth. That’s a lot closer

Since 1980, the S&P 500 has dropped more than 14% on average at some point during the year
& it still averaged about 10.7% a year over that stretch
Right now the S&P is about 4% off its all time high. The Nasdaq 100 is about 10% off
So this isn’t unusual. It’s a pretty normal year that started out expensive.
The problem is everyone forgets that until it happens. Then a 10% drop feels like the end of the world
Here’s how I use this to my advantage...
HAVE A PLAN & THESIS BEFORE THE VOLATILITY.
& when the volatility comes... I am ready to rock & roll while many other people are in a state of pan

The Nasdaq $Q is about 10% off its high. Officially correction territory
Here’s what I’m NOT doing:
NOT panic selling great companies
NOT buying weekly puts to “protect” myself
NOT selling covered calls to “pad the downside”
NOT selling short dated puts on whatever fell the most for juicy premium
NOT going to all cash to “wait for clarity”
Here’s what I AM doing:
Holding my base. $VOO , $Q, $RSP & great companies
Keeping ratios well within check with options.
& if a great company/ETF drops below fair value?
Buy shares.
Sell 1+ year portfolio secured puts
Buy 1+ year calls
Opportunity is coming.

AI stocks have lost about $5 TRILLION in value in roughly 3 weeks
So naturally everyone’s asking... is this 2000 all over again?
Let’s actually compare
In 2000 the Nasdaq $Q traded around 99x forward earnings. Right now it’s about 20x
In 2000 the Nasdaq 100 went on to fall over 80%. Right now it’s about 10% off its high
In 2000 tons of the leaders had no profits. Right now S&P forward earnings are up almost 30% from a year ago
Are there bubbles inside AI? Yes.
But “some expensive stocks are falling” & “it’s 2000” are very different things
Finding an elite company obviously matters. BUT! Gettin

The ABSOLUTE worst day in ALL history to buy the Nasdaq $Q was March 27, 2000.
$117.75 a share. The very top of the dot com bubble.
By October 2002 it was $20.06. Down 82%.
It took about 15 years just to get back to even... & that's WITH dividends reinvested.
But if you bought that exact day & did nothing, today it's around $740. About 7x your money with dividends.
Now the person who bought in October 2002 at $20... that's about 37x on price alone.
Same fund. The only thing that changed was the price paid.
That's why I don't buy just because something is going up. I want great companies/ETFs t