InvestingWithBrandon

Midterms are less than 3 weeks away & the market is getting choppy right on schedule
Midterm years have historically been weaker going INTO the election...
& then the year after has been a totally different story
The S&P 500 has been higher 6 months after every midterm election since 1954. Average gain in those 6 months: about 14%
Guaranteed this time? Nothing is. I’m not betting the farm on a seasonal chart
But combine it with a P/E right at its 10 year average & earnings growing ~29%... & the setup doesn’t scare me
Bumpy next few weeks? Probably. Especially with Iran in the headlines
That’s

Retail investor: Make it make sense. Inflation came in HOT & bond yields went DOWN??
Me: Yep. 10 year went from about 5.35% to 5.08% in like 24 hours
Retail investor: but hot inflation should mean higher rates
Me: That’s the logic. The market doesn’t always follow logic in the short run
Retail investor: so why’d it happen
Me: People got scared of stocks & ran to bonds. When everybody buys bonds, bond prices go up... & when bond prices go up, yields go down. They move opposite
Retail investor: so it’s just fear
Me: Mostly. Money rotating out of stocks into “safety”
Retail investor: is that bad?

A couple weeks ago I added bonds to my account & people thought I lost my mind
“Brandon the market’s ripping, why would you buy BONDS?”
Because my stock sheet/overall thesis had $Q about 10% above fair value. When the market gets hot I lower my risk... fewer sold puts, took profits on $META, & moved about 15% of my account into bonds
I don’t have a crystal ball.
Timing the market is next to impossible.
I just follow the valuations/totality of data.
This week the Nasdaq 100 dropped almost 5% & chip stocks fell 9 days in a row
& today I started doing the opposite... swapped some of those bonds b

NAS100+0.98%

Want to know how I can tell this selloff isn’t a big deal? (not kidding)
Nobody can agree on WHY it’s happening
AI debt. Hot inflation. Iran. Cheap Chinese memory chips. Midterms. Pick your headline
When something actually big happens, everybody knows the reason on day one. COVID was a big deal thing. China invading Taiwan would be a big deal thing
Yesterday... The S&P fell 1%, it’s 2% off its all time high... & every account on here has a different explanation
So what did I do?
I checked if anything changed with the data that moves the needle.
Valuations? Forward PE is 19 (ok)
Economy? Unempl

SPX-2.19%

Retail investor: Market’s crashing dude. Nasdaq down 2% yesterday, chips getting destroyed. I’m thinking about selling everything
Me: How far is the S&P from its all time high right now?
Retail investor: idk like 15%?
Me: 2%
Retail investor: no way
Me: Record close was October 6th. Today it closed about 2% below that. Nasdaq’s about 5% off its high
Retail investor: it feels WAY worse than that
Me: Because your feed is full of people down 20% this month doing crazy trades... Chips just fell 9 days in a row & a lot of those guys were all in on them
Retail investor: so what’s the S&P up this year

NDAQ+0.51%

SPX-2.19%

Someone paid me $4,754 to agree to buy their $UNH shares at $350... 2 years from now
Say that out loud. It sounds crazy!
They handed me $4,754 instantly, for a PROMISE
A promise to buy a company I already love, at a price I’d be thrilled to pay
If $UNH never drops there? I keep the $4,754 for nothing
If it does? I buy a great company at a discount...& STILL keep the $4,754
& my base portfolio secured the whole trade, so no cash drag like CSP.
(my ROI is technically infinite cause it's not CSP)
Oh & I only sold this contract 2 days ago...
UNH beat earnings, raised guidance & the put is ALREADY

UNH+0.22%

You would think the market was down 20% in 1 day with how many people are panicking now…
This is NORMAL & JUSTIFIED volatility.
Market was a little over valued and now it’s resetting. That is ok!

Retail investor: Cash secured puts are actually good now. My cash earns like 4% in a money market while it secures the put
Me: Ok so your collateral makes 4%
Retail investor: yeah free money
Me: My collateral is $VOO & $Q
Retail investor: wait... what?
Me: Yea... & the Nasdaq $Q is up 97% in the last 5 years... meanwhile you are getting 4% a year...
Retail investor: ok but in a crash...
Me: My ratios are WELL within check to be just find in a deep 50%+ crash where my base portfolio can cover all the assignments. Of course can roll too.
Retail investor: so 4% vs 12%+
Me: Every year, on the full

VOO-1.11%

NDAQ+0.51%

Retail investor: JPMorgan Chase $JPM says higher rates could stress the economy & CEO Jamie Dimon says be prepared for a tougher environment. If JPMorgan’s worried I’m going to cash
Me: What else did he say on the call?
Retail investor: idk that’s what the headline said
Me: He also said “the consumer & economy is still in good shape.”
Retail investor: wait really
Me: Yep. Said business investment & spending are still strong. Then he listed the risks... rates, sticky inflation, deficits, high asset prices, geopolitics. All fair. He never said sell everything though. Just that risks are present.

JPM+1.24%

A few months ago someone paid me $20,946 to agree to buy their $NVDA shares at $180... in December 2028
Say that out loud. It still sounds crazy!
They handed me $20,946 instantly, for a PROMISE
A promise to buy a company I already love, at a price I’d be thrilled to pay
Today that promise is up 35.34% (+$7,401)
& that’s AFTER all the AI fear selling this week.
If $NVDA never drops to $180? I keep the full $20,946 for nothing
If it does? I buy a great company at a discount...& STILL keep the $20,946
& my base portfolio secured the whole trade, so no cash drag like CSP
This is the power of the p

NVDA-1.42%

I make about $29k a month with options.
NO Day trading
NO Swing trading
NO Covered calls
NO Cash secured puts
NO BS
INSTEAD, I DO THIS:
Build base portfolio
Sell portfolio secured puts (not cash secured)
Buy LEAPS with the premium from sold puts
BUY shares with the premium from sold puts
Keep ratios in check
I can explain it to a 13 year old & I will likely outperform 95% of people that read this.
Simple wins.

Retail investor: Oil’s back over $100 & they’re hitting tankers in Hormuz again. I’m thinking about going to cash till it calms down
Me: When does it calm down?
Retail investor: idk... when the war’s over?
Me: Brent oil hit around $118 back in March when the strait shut down. Everybody was saying exactly what you’re saying...
Retail investor: & what happened?
Me: Nasdaq made a new all time high a few weeks later and now up over 30% from that point.
Retail investor: with all this still going on??
Me: Yep. The market doesn’t wait for the all clear. It moves as soon as it figures out earnings are

BZ-1.41%

NDAQ+0.51%

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 22... 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 20%+ this year & next
Retail

NAS100+1.37%

SPX500+0.60%

The market is NOT crashing right now.
The SP500 is within 2% of ATH.
If you are getting smoked, its because your gambling… not investing.
$VOO