The Playbook

I won't walk through each individual holding and why I'm bullish, because that would be beating an already very dead horse. But notice: all large cap, no disworsification, and the position sizing is purposeful.

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I’m scared.

A downturn like I’ve never seen before. I just watched a 20% drop in what feels like the blink of an eye. The strongest indexes are being sold off like the world is ending, and everywhere I turn for news I’m being told it’s the beginning of the end. The fear isn’t just in my portfolio — it’s in my chest. I feel it in every aspect of my life.

The macro data is mixed, with more bad than good. There’s no clean decision to make, and every day brings a headline worse than the last.

True confession: I never wrote that before just now, and the date is vague for a reason — not because I don’t remember.

Because depending on how old you are, how long you’ve been investing, and how active you are in your portfolio, you just read that and associated it with a feeling you’ve had. A 20% downturn in March, 20XX could be any of the following:

• 2008 Crash

• COVID 2020

• Inflation Hike 2022

• Tariff Fiasco 2025

Four completely different events. The same fear every single time.

Investors are united by panic — but the majority default to selling instead of buying.

We’re going to fix that.

The Worst Strategy in Investing

Panic selling. It’s the art — if you want to call it that — of selling your positions at the bottom because emotions took over. You lock in real losses for the temporary feeling of safety, convincing yourself it could go lower. Then comes the rebound, as it almost always does, and the safety turns into regret. Now you’re buying back into the same position at a higher price just to not miss further gains.

TL;DR — Ever heard of “buy low, sell high”? This is the exact opposite.

The urge to sell everything when it’s red is the definition of market propaganda working on you. Think about it: buying an actively depreciating car is considered a sign of success nowadays (as correctly pointed out by ). If your house were to dip 30% in value, the thought of selling it wouldn’t even cross your mind. I could go on listing assets people hold through downturns without a second thought — except for one: stocks.

The stock market is the only place where everything going on sale makes people want to leave the store.

Studies show that missing just the 10 best trading days in a 20-year period slashes your total return nearly in half. And here’s the part most people miss: the majority of those best days happened immediately after the worst ones. The biggest green days come right after the biggest red days — and if you sold during the red, you weren’t there for the green.

The urge to sell everything in a downturn is a common experience for every investor. It’s also the most expensive mistake most of them will ever make.

Make This Time Different

Let’s audit the current economic situation:

• Historically high tariffs

• Rumors of war

• Recession whispers

• AI bubble fears

All of these are real threats, and each one creates genuine uncertainty. I’m not here to dismiss any of them. But here’s what the market is actually doing: pricing itself as if the worst-case scenario for all four happened simultaneously. Fear moves the market faster than reality ever could — that’s why dips are sharp and violent while rallies seem to sneak in unnoticed.

Most investors think the market waits for good news before it rebounds. It doesn’t. The market begins its rally when things go from “dumpster fire” to “slightly less bad.” You don’t need an all-clear signal. By the time you get one, the move already happened.

I don’t have a crystal ball, and I’m not going to pretend I had a Michael Burry moment to earn your trust. But allow me to show you that the market’s own history agrees with my logic.

Be Smart, Not Reckless

Putting everything into stocks tomorrow could work out. But so could putting everything on black. Here's a framework that will actually make you money.

• Don’t time the bottom, you won’t. You won't. Maybe the market gives you one lucky call — the first one's always free. Instead, spread your buying over weeks and months. Dollar-cost averaging means if the market drops further, your remaining cash is ammo, not a homemade bomb.

• Buy quality, not hype. During inflation, analysts talked about the first services customers would cut to save money. Apply that same filter to your stocks. If a company's product is the first thing people cancel in a recession, it's not the name you want to be holding. In times of panic, buying speculative stocks or "the next Nvidia" penny stocks just lets you lose money faster.

• Have a plan. Easier said than done — I guarantee fewer than 30% of people reading this right now keep a journal of their investments. But this is what separates run-of-the-mill investors from extremely profitable ones. Know what you own, know why you own it, and know when you'd get out.

• Alway keep cash in reserve. Ties back to point one: cash is ammo, not what blows up your account. If things get worse, the investor who kept cash on the side gets an even lower entry price. The investor who went all in at once just takes a bigger hit and watches.

This isn't ignoring risk. This is facing it head-on and profiting from it smartly. Risk is a byproduct of fear, and fear is what makes investors rich.

Every person who has bought during a market panic and held for a minimum of five years made money. Prove me wrong.

The hardest part of becoming a profitable investor isn’t the analysis — with the internet, that’s the easy part now. It’s the psychology. It’s buying when social media, the news, and every other Substack writer is telling you not to.

Now picture the guy who started investing in 2021 and hasn’t checked his portfolio since. Better than the first guy? Sure. But not by as much as you’d think.

Neither extreme works if you’re an active investor trying to actually build wealth.

Swing-to-long trading is the best of both worlds and the worst of neither. The idea is simple: hold positions for a few weeks to a few months, giving you the best risk-adjusted edge without burning out or leaving money on the table.

What It Is

Swing-to-long sits right in the middle of the trading timeframe spectrum — and that’s exactly the point.

You enter on a technical breakout or a catalyst-driven setup, just like a swing trader would. But here’s the difference: you’re not locked into flipping it in a week. If your longer-term thesis on the position still holds, you have the flexibility to ride it. The entry is tactical. The hold is strategic.

The key thing to understand is that you aren’t flipping positions willy-nilly. There’s still research involved. You’re still developing long-term theses on the stocks you buy.

But you aren’t married to the position either. If you hit a profit you’re happy with — great, take it. If the thesis crumbles or the fundamentals shift — you exit, no hard feelings. That flexibility is the whole point.

Day Trading Will Always Suck

I don't think I'm saying anything controversial here. The majority of "courses" sold on day trading are scams. 90% of retail day traders lose money within their first year. And a lot of the "traders" you see on the Nasdaq floor? Paid actors. Fun fact.

Then there are the hidden costs nobody talks about: commissions stacking up on volume, relentless short-term capital gains taxes, and what I’d imagine is an embarrassing daily screen time report.

Look — day trading can work. But the stars need to align. The edge is razor-thin, it requires full-time commitment, and usually an already large, established account. All that for a 10% chance of even being profitable in year one. Yikes.

Buy and Hold Has Blind Spots

The common advice is “just buy the S&P and wait.” Not wrong — but not the whole picture either. Especially if you’re someone who wants to actively grow wealth and is willing to put in extra time to increase returns.

The piece that gets left out of the buy-and-hold pitch is the opportunity cost of sitting through extended drawdowns and just... waiting for them to recover.

I'll use myself as an example. I held a heavy position in Nvidia (NVDA) through the April 2025 tariff scare. I didn't have a plan for that scenario, and it was a scary hold. Most people aren't comfortable buying a position, watching it drop 30%+, and toughing it out over the next several months or years. You could blame this on my lack of a plan — but I'd argue I lacked a runway. The whole premise of buy-and-hold is to not be actively watching your stocks or doing deep research. I did the research. But my timeline didn't match the economy's, and it shook my portfolio.

An active and dynamic framework builds capital now and later.

Why Swing-to-Long Works

Ultimate flexibility. Take profits on strength or let winners ride if the thesis holds. Either way, you aren't locked in.

Tax positioning. Holding past 30 days avoids wash-sale headaches — that’s when a stock is bought and sold at a similar price in a short window. And if you let winners ride long enough, long-term capital gains treatment becomes a real possibility.

It aligns with how catalysts actually play out. This isn’t just a “buy the dip” play. There’s something real behind the trade — a stock beating earnings expectations, sector-moving headlines, a Fed rate decision. These feel like immediate events, but they actually take weeks to months to fully get priced in. That’s exactly swing-to-long’s timeframe.

Risk management is a must. You set a thesis, set a stop-loss, and set a target or a runner position. If it works — great, consider repeating it. If it doesn’t — you move on. Simple.

I even got AI to make a flow chart to simplify the already simple process, use it free of charge.

It’s Not For Everyone

Swing-to-long trading isn't for everyone. You can certainly retrofit it into any portfolio, but it shouldn't come at the expense of your comfort. Here's what I think the ideal audience looks like:

• Independent investors who want to be engaged, but don’t want trading to be their full time job.

• People building capital in their early years of investing and can’t afford to just “wait 30 years.”

• Anyone who’s burned out on day trading or frustrated by the passivity of buy-and-hold.

If any of these sound like you, I wouldn’t just encourage you to give swing-to-long a try… I’d encourage you to subscribe to Monk Investments too.

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I’m going to leave you with one last graphic to show swing-to-long’s stats compared to the two extremes. Not to prove to you that it’s the best, but to leave the decision to you. Find what works best for your life.

Conclusion

The best trading strategy is the one that fits your life — not the other way around.

In my experience, swing-to-long trading is the middle path that actually prints returns. You do the research, you enter the trade, and you give yourself the flexibility to do the needful after. No checking your phone every minute, and no holding for 6 months during a 30% drawdown.

Information, action, discipline, returns, repeat. That’s the Monk way to trade.

I still have the “Starting Over With $10K” paper portfolio, but I figured that with higher stakes, this would be more valuable for you as a reader and more meaningful for me to write. If you prefer this style over the paper portfolio updates, leave a like or drop a comment — that feedback helps me decide where to take this.

Without further ado — the first raw portfolio update.

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Because independent investing isn’t a cheat code. Sometimes you read the trend perfectly and still get burned. I want to share my three biggest losses on a percentage basis from my own personal brokerage. Each one had a different thesis going in, and a different reason it fell apart.

But First — Let’s Get Something Straight

I'm not writing this from the sidelines, and I'm not deep in the red either. I'm a successful investor and I plan to stay one. Here's my YTD return — which actually happens to be the slowest start I've had so far.

That's my personal brokerage, which runs a much more conservative strategy. Separate from that, I have a personal experimental paper account (not the "Starting Over With $10K" portfolio — this is a different one). Here's the return since inception, about ten months in:

Losses are part of the game for every investor, including profitable ones. What separates winners from the rest is learning from your mistakes. Repeat what works until it doesn’t. When you lose, figure out what went wrong and why. That’s what’s made me successful so far.

So without further ado — let’s get into it.

Pinterest (PINS) - User Sometimes DON’T Equal Dollars…

My Thesis:

Everyone and their mom uses Pinterest — literally. My mom, other female family members, female friends, the girl I was seeing at the time. When I say everyone, I mean it. On a price-to-earnings basis, it looked criminally undervalued compared to big names like Meta, Snapchat, or even YouTube specifically.

What Went Wrong:

Users don't always mean dollars. I was right in my analysis: the user count was growing astronomically and PINS was indeed undervalued on paper. But I was blind to the fact that management was unable — or unwilling — to capitalize on all those new users. More ads, subscriptions, better monetization tools — none of it came. So this for-profit business with hundreds of millions of active users was bringing in pennies on the dollar compared to what it should have been.

The Lesson:

A crowded product with ~8% margins is often a worse investment than a quieter one running at 20%. I saw the trend correctly, but I missed one of the most important pieces of the puzzle — and the business still hasn’t figured it out. If Pinterest eventually grows their margins and introduces real ways to monetize users, I’ll give it another look. For now, it’s a hard loss to stomach.

Pinterest taught me that popularity doesn’t equal profit. But the next two losses taught me something harder — about listening to the wrong people, fighting the market, and knowing when to walk away.

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I’d called ahead — three left in stock. That was an hour ago. Aisle by aisle, I hunted, running through the mental math of how close I was to finally finishing this build. Then my stomach dropped. Another customer was walking toward checkout clutching the exact component I needed.

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I rushed to where he came from. One box left on the shelf. I grabbed it — a graphics card, $1,800 at the height of the GPU shortage. I didn’t care. My build was finally complete.

On the drive home, I couldn’t stop talking about specs and frame rates. My father, an avid investor, mentor, and Monk Investments reader (thanks Dad!) was quiet for a moment. Then he said something I didn’t think much of at the time:

“If this thing is in this great of demand and in constant shortage, the company ought to be doing pretty well for themselves.”

The graphics card was an Nvidia GeForce 3080 Ti. Hours later, my dad bought Nvidia stock.

He didn’t read an analyst report. He didn’t study a chart. He watched his son nearly lose a fistfight in a computer store over a product that was impossible to keep on shelves — and that told him everything he needed to know.

That was 2023. He’s still holding, and on a percentage basis, Nvidia has been the biggest winner of his investing career.

My dad didn’t have insider information or a Bloomberg terminal. He just paid attention. And that instinct — noticing what people around you can’t stop buying — might be the most underrated investing edge there is.

It’s Simple, Invest in What You Know

The brands you use, trust with your daily life, and see as almost a necessity tell you something about their business — not just about your relationship with them as a customer.

Legendary investor Peter Lynch built his career on this exact idea:

One of the best investors of his generation, and this was his main tool to beat the S&P 500 for over a decade.

So instead of scrolling through misleading newsletters, Googling “best stocks to buy 2026,” or — God forbid — considering a Motley Fool subscription, let’s break down this simple investing mindset.

Don’t be a Consumer, be an Investor

This simple idea is, unfortunately, a big part of what separates everyday investors from the ones who consistently win. But the catch is, to truly capitalize on trend-based investing, you have to be early. Not on time — early.

That means leaving the charts, shutting down Bloomberg, and cutting back on the financial news. When you’re out in public, just become annoyingly more observant than usual. Sometimes the opportunity is as obvious as my graphics card dilemma. Other times it starts as a quiet thought that sends you down a rabbit hole.

This might sound like something that only comes naturally to career investors like Peter Lynch. But I’d argue it’s easier now than it’s ever been. TikTok, Reddit, Instagram — everything you scroll through is a front-row seat to emerging trends. By the time an analyst publishes a report, an attentive investor has already been watching the stock climb for six months.

Proof This Actually Works

My Nvidia example is certainly a cherry-picked winner. But I have plenty of other examples to share — ones I'd bet many of you have experienced yourselves. Starting with a morally questionable investment that was screaming "buy."

Vapes

I have vivid memories of walking into high school bathrooms and inhaling straight cotton candy and sweet mixed fruit clouds.

Instead of acting like a hall monitor, I figured there was an opportunity here. I researched which stocks were connected to vapes and landed on Philip Morris (PM) and Altria (MO). After digging deeper, Philip Morris stood out as the stronger play. I invested in 2020–2021 and sold in 2022 for a solid 20% profit.

Electric Vehicles

As many of you probably noticed, it felt like Teslas took over every road for a while. While there were plenty of underlying issues with Tesla stock, one thing remains universal for any business: more sales means more money. And Tesla was no stranger to selling cars from 2021 to 2024. With the stock's steep drop in 2022, it looked like a perfect opportunity to buy.

To be clear, Tesla's fundamentals were far from impressive — and that was true in 2022 as well. But this was a riskier swing trade I was willing to take. I knew what I was seeing on the road wasn't deceiving me: a lot more Teslas.

Chip Shortage

Revisiting the Nvidia example, the explosive growth this company has had speaks for itself. Their rally really started with the chip shortage I braved in 2023, but as we know, it's continued well beyond that as they've expanded into data centers.

Doing This Wrong Will Cost You

A fair warning: simply liking a product doesn’t mean the business behind it is worth investing in.

The world doesn’t revolve around whether Joe himself vapes or drives a Tesla. These companies succeed or fail based on whether they’re profiting off the massive wave of people adopting these products.

There are checks to make anytime you think you’ve stumbled onto an investment opportunity in the wild.

1. Is this company actually making money?

2. Is the stock already priced well or overpriced?

3. Is this a fad a small demographic is picking up, or a global trend?

Keep it simple. Observe. If something catches your eye, check the numbers. If the stock is underpriced and you're early to the trend, consider buying. And if anything in that equation doesn't add up, abandon ship. Better to admit you were wrong and lose nothing than keep your pride and watch your dollars slide.

Real World Practice

This can seem like a daunting task. “I’m already trying to learn how to invest — now I have to do it at the grocery store too?” Yes. Let curiosity get the best of you.

I encourage you — yes, you reading this — to keep a running note on your phone for any opportunities that cross your mind when you’re out and about. You can decide later whether they’re worth pursuing, whether the numbers back it up, or whether you actually want to put real money behind the trend.

This is independent investing at its finest.

You don’t need a Bloomberg terminal or a finance degree. Your everyday life gives you more investment signals than any overpriced newsletter ever could — but it relies on you paying attention. The next time you’re standing in line and everyone around you is holding the same brand, think twice before you check out.

Global markets were plummeting — a weakening global economy was dragging down everything in sight. JPMorgan (JPM) shares were down nearly 20% and the S&P down more than 10% at their lows. Everyone was panicking. Everyone was selling.

After the closing bell of this bloodbath of a day, Jamie Dimon (CEO of JPM) had some news to disclose: he had bought 500,000 shares of JPMorgan stock, worth ~$26 million at the time of purchase. For perspective, his entire 2015 compensation was $27 million. The man bet a full year's pay on his own company while everyone else ran for the exits.

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February 11th turned out to be the lowest point both the S&P and JPM traded at for all of 2016. Many dubbed it "The Jamie Dimon Bottom." JPMorgan finished the year up 30%, and Dimon's shares returned 68.5%.

This wasn't the only time Dimon pulled this move. He bought 500,000 shares during the 2009 financial crisis (which have since returned nearly 700%), and made another buy during a downturn in 2012 (which returned over 430%).

Is Dimon more versed in the financial industry than the average investor? Likely. Can he keep his emotions in check during a market downturn? Of course. Does he have access to information that the common investor doesn't?

Intro

If the people running the company are betting their own money on their ability to steer their own ship, what do they know that you don't?

You probably know more about the business you work at than any outsider does. Yet when insiders buy their own stock, it's brushed off as normalcy — a "power move" to "inspire new investors." Allow me to make the case that insiders buying their own company's stock know something you don't.

This isn't insider trading. It's disclosed insider buying — and it's the most telling buy signal hiding in plain sight.

What Insider Buying Actually Is (yes, it’s legal)

First, let's define what makes an "insider" worth tracking. An insider is a stakeholder closer to the captain's quarters than you are: executives, directors, officers, or major shareholders (10%+).

Why must these people disclose when and where they buy stock? Because the SEC (Securities and Exchange Commission) says so — it's called Form 4, and it's public record.

Insider buying is different from stock options or grants that a company offers. Those are employee compensation tools and have no correlation to the actual insider buying I'm referring to. Open market purchases from powerful people with skin in the game — that's meaningful information. Stock options and grants are just noise.

Finally, I'm focused on buying, not selling, for a reason: there are countless reasons to sell a stock and we rarely know the "why" behind an insider's decision to sell. But there's only one reason to buy.

Insiders vs. Analyst Ratings

Many investors rely on analyst ratings for another “professional” perspective. The problem is that analysts are outsiders looking in. That stock they just told you will climb 60% this year? It’s one of dozens of reports on their desk. And like many things, analysts have strength in numbers — which cuts both ways. If 100 analysts cover a stock and only 2 rate it a sell, your view would be very distorted if the first report you opened happened to be one of those two.

Insider buying avoids these problems entirely. It’s stakeholders from within the business applying what they know about the company to the stock — where analysts have it the other way around. Quantifying the confidence of insiders vs. analysts is simple: who has more at stake? Analysts have their reputation, granted. But insiders are risking their personal wealth, banking on a return. I would rather bet alongside people who have skin in the game than trust a mandatory speculation report. These insiders have asymmetric information — they see the pipeline, the margins, the efficiency of the operation. They know better than anyone whether the business will output a return or not.

What to Look For, and Where to Find It

The thing about insider buying is that looks can be deceiving. If a billionaire CEO buys $1M worth of shares, you can see how a headline like that might swing the wrong perspective. That purchase is essentially no different than Jeff the janitor buying $100 of stock in the company he cleans floors for — relative to their wealth, neither is putting much on the line. Often, a director making $180K a year who buys $50K of shares tells a better story than any exec buying to “communicate stock confidence.” The size of the buy only matters relative to what they have to lose.

So to combat this, investors look for something called cluster buying. As the name suggests, cluster buying is when multiple insiders buy around the same time and price. A single purchase is a data point. A cluster is conviction — and it creates a far stronger signal than any outlier buy on its own.

Finding this data is easy and free. Here are some of the best places to look:

SEC EDGAR is the primary source — it’s free, straight from the SEC, and where all Form 4 filings live. If you want something more user-friendly, OpenInsider, Finviz, and Dataroma all pull from the same data but present it in cleaner, more digestible formats.

There are fancier tools out there with better visualizations and additional screening features, but they tend to come with a price tag. For what you need as a beginner, the free options more than get the job done.

Not a Sure Shot + Closing

While this may come as a surprise to some, these insiders are just as human as us. They can be wrong and it’s not uncommon for their financial judgement to be driven by their own company bias. Moreover, some companies have very little insider activity or mistime their buys heavily. Insider buying tracking is a great tool to have alongside fundamentals and other analysis, but can be catastrophic if looked at on its own.

That being said, insider buying is often more timely than any technical indicator can ever get it. Remember… outsiders looking in vs. insiders looking out.

Warren Buffett has one of—if not the—greatest investing track records in history. That being said, Berkshire Hathaway is repeating the same mistake that cost them billions before, and this time the stakes are even higher. The data says he's dead wrong.

People are on edge when looking up to Buffett for guidance; Berkshire is sitting on a record-breaking $300B+ cash pile and continues to trim positions in companies that other institutional players are buying aggressively.

One position in particular—a company Buffett already admitted he was wrong about—was quietly sold. By the time we get to the data, you'll understand why this might be the most expensive exit of his career.

The thesis of this article revolves around the recent *capital expenditure "mega-cycle" within the Magnificent 7 (the seven biggest publicly traded companies). It's one of the most misunderstood investment stories on Wall Street—and apparently, even Buffett's framework can't see it. One company in particular proves exactly why.

*[Free article where I break down what capital expenditure (CapEx) is!]

CapEx-KaBoom

It's no secret that being in the Magnificent 7 means spending money to make money. But the scale of that spending is what has investors like Buffett concerned. The top 6 companies in the Mag 7 spent a combined $79 billion in 2019—and are expected to spend a staggering $625 billion this year.

The skeptics are asking a valid question: “Where is all of this money going?”

The answer is far simpler than you’d think. It’s not being thrown at a vague buzzword like “AI training” or some other generalized AI term. Nearly every dollar expected to be spent this year is going toward infrastructure: data centers, GPU clusters, and cloud capacity. And here’s why that matters:They’re typical investments for tech giants—just on a much larger scale.

1. They're typical investments for tech giants—just on a much larger scale.

2. The "much larger scale" isn't an all-or-nothing gamble on AI. It's keeping up with demand these companies already have for the AI models they run today.

3. These companies fuel each other's businesses. Nvidia supplies the GPUs for newly built data centers. Amazon Web Services provides the cloud for hosting AI models. Money flows between them in a reinforcing loop.

But one question lingers from seasoned investors: "Haven't we seen this before?"

For the Last Time, It’s Not Dot-Com 2.0

It's easy to slap that quote onto the dot-com bubble and point it at 2026. Unheard-of spending, sky-high valuations, an unhealthy worship of AI—it's undeniably similar on the surface. But even a little research proves the comparison wrong.

Revenue and Earnings

How much revenue did speculative dot-com companies generate? Essentially zero—because that's what "speculative" means. At its peak, the Nasdaq hit a P/E ratio of 200x because investors were dumping money into these companies faster than they could generate a single dollar of profit.

Compare that to today: the Nasdaq sits around a 32x P/E. The Mag 6 collectively generated ~$2.19 trillion in revenue and ~$653 billion in operating income in 2025.

Who’s Writing the Checks?

In the dot-com era, the money was smoke and mirrors—venture capital, IPO proceeds, borrowed funds. Everything except actual business profits.

Where are the Mag 6 getting their CapEx money? Not from fresh IPOs. These companies have been around for decades—and they all survived the dot-com crash. They're reaching into their own free cash flow to finance capital expenditures, backed by a track record anyone can trust. Collectively, these companies generated $200B+ in FCF in 2024 while already spending aggressively on AI.

Still, A Great Balance Sheet

Dot-com companies carried massive debt with no earnings and no assets to show for it.

The Mag 6? Roughly $350B in cash and equivalents.

So why would the greatest investor alive act like it's 1999?

Buffett’s Blind Spot — The FCF Trap

Buffett's core investment philosophy boils down to one idea: a company's intrinsic value equals the present value of its future free cash flow. It's worked brilliantly—he's found great companies with strong moats at cheap prices and held them forever.

Invert that logic: if CapEx is surging and FCF is compressing, these companies must look terrible through Buffett's lens.

And on paper, they do. But these companies don't operate based on whether Buffett considers them a good buy. They're building tomorrow's earnings, not protecting today's cash pile.

Buffett's model systematically penalizes companies in aggressive reinvestment phases. It's helped him look like a genius when the market has crashed—twice in the past four decades. Playing it safe means coming out of crashes looking smart. But investing aggressively in companies building the future? That's what separates smart from genius.

Buffett knows this, too. He has historically avoided or exited tech positions during buildout cycles, only to admit later how much he regrets it. From a 2017 shareholder meeting, speaking about a specific Mag 7 company:

And another quote, about the same company:

Which company? One that has proven this exact pattern before—aggressively invest, compress FCF, then watch the stock explode upward when the investment pays off. And now Berkshire is falling for the same trap again... with the same company. Selling shares they bought in 2019.

Fool me once, Buffett. Fool me once.

Allow me to reveal the biggest position in my portfolio, and Buffett’s biggest mistake:

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I’ve seen this headline plastered across finance news and Substack for weeks. And if you don’t know what “capital expenditure” means, it sounds terrifying—especially if you own Google stock.

All you’re left with is some massive number, a vague sense of dread, and questions: Is this bad? Should I sell? What are they even spending it on?

Here’s the thing: CapEx headlines are designed to grab attention, not give you clarity. And when earnings season hits, you’ll see dozens more just like it.

So let’s clear the air. By the end of this breakdown, you’ll know exactly what capital expenditure is, why companies spend it, and—most importantly—how to tell if it’s a red flag or a smart investment in the future.

No jargon. No finance-bro nonsense. Just the truth about where your money is going when you invest in a company. Let’s dive in.

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What IS Capital Expenditure? (The Basics)

Capital expenditure (CapEx) is money a company spends to buy or upgrade assets that last for years.

Think buildings, factories, equipment, or—in Google’s case—massive data centers to power their AI models.

Here’s the key difference: CapEx is an investment. Operating expenses are just the cost of keeping the lights on.

Example:

• Paying rent every month? That’s an operating expense. You pay it, it’s gone, and next month you owe again.

• Buying the building outright? That’s CapEx. You own it. It creates value for years. It’s an asset on the balance sheet.

Same goes for everything else:

• Leasing a delivery truck = operating expense

• Buying a fleet of trucks = CapEx

• Paying for cloud storage monthly = operating expense

• Building your own data center = CapEx

The bottom line: CapEx is about owning things that generate value long-term. It’s not money disappearing—it’s money being put to work.

Why Should Investors Care? What They Call The “So What” Factor

At first glance, CapEx seems pretty straightforward—just companies buying stuff they need to run the business. So why all the dramatic headlines?

Because high CapEx is a bet on the future. And not all bets pay off.

When a company like Google announces they’re doubling their CapEx spending, they’re essentially saying: “We’re pouring billions into something we think will make us money down the road… but it’s not guaranteed.”

For investors, that’s nerve-racking. You’re watching cash leave the company now in hopes it generates returns later. And if it doesn’t? That’s billions down the drain.

But Here’s the Catch: Not All CapEx Is Created Equal

Some industries require high CapEx just to survive.

• Oil and gas companies need refineries

• Car manufacturers need factories

• Airlines need planes

For these businesses, heavy CapEx spending is normal. It’s the cost of doing business.

But when a software company suddenly starts spending like a manufacturing giant? That raises eyebrows.

What Really Makes Investors Nervous

It’s not just the dollar amount. It’s what CapEx does to free cash flow (FCF)—the money left over for dividends, stock buybacks, or paying down debt.

*Psst! Learn more about free-cash-flow and other terms Here!

When CapEx eats into this cash cushion, investors get anxious. Because now the company has less flexibility, less room for error, and less cash to return to you.

The question every investor should ask:
“Is this CapEx spending going to generate enough future revenue to justify eating into our safety net?”

Why Everyone Can’t Stop Saying “CapEx” | The AI Arms Race

Remember that Google headline from the intro? The one about spending more in the next 5 years than they did in the past 20?

Let’s talk about why that number—and dozens of headlines just like it—have taken over finance news.

The Numbers Are Bonkers

Amazon, Google, Microsoft, and Meta—none of which are traditionally CapEx-heavy industries—are planning to spend over $650 billion in 2026 alone.

That’s more than the entire GDP of Sweden. In a single year.

Breaking it down:

• Amazon: $200 billion

• Google: $175–$185 billion

• Meta: $115–$135 billion

• Microsoft: $120+ billion

These aren’t estimates from analysts. These are the companies’ own projections.

This Isn’t Normal Business Spending—It’s a Poker Game

Here’s where it gets wild: these companies are actively outbidding each other.

Google announces $185 billion? Amazon immediately updates their guidance to $200 billion.
Meta goes to $135 billion? Microsoft isn’t far behind.

It’s like a high-stakes poker game where everyone’s confident they have the winning hand—so instead of calling, they just keep raising.

Why? They all want to dominate AI in different ways, but none of them want money to be the reason they fall behind.

The Gamble: Nobody Knows If This Will Pay Off

This isn’t like building a factory where you know exactly what you’ll produce and how much revenue it’ll generate.

These companies are betting on three massive assumptions:

1. AI demand will keep skyrocketing

2. Their infrastructure will generate massive future revenue

3. They won’t get left in the AI dust by competitors

Right now, those assumptions look solid. But here’s the catch: the future is still uncertain.

Some analysts project these companies’ free cash flow could drop by 90% in 2026 in a worst-case scenario.

Amazon’s FCF? Projected to go negative for the first time in years. Meaning they’ll be spending more cash than they’re bringing in.

That’s exactly why Amazon’s stock tanked after earnings. Investors did the math—and got nervous.

The Bottom Line: CapEx Isn’t Just a Line Item Anymore

Some call this visionary. Others call it reckless.

But one thing is clear: these companies aren’t treating CapEx as normal business spending. They’re treating it like life or death.

Because in the race for AI dominance, falling behind isn’t an option—even if it means burning through billions of dollars hoping it pays off later.

Conclusion

Capital expenditure shows you exactly where management is betting the company’s future.

And as an independent investor, your job isn’t to blindly trust those bets—it’s to decide whether you believe in them too.

Your CapEx Audit Checklist

Before you buy (or hold) any stock with major CapEx spending, ask yourself:

1. Do I actually believe in what they’re building?
Don’t just accept “AI is the future” because a CEO said so. Do you think their specific AI bet will pay off?

2. Can they realistically capitalize on this investment?
Spending billions is easy. Turning it into revenue? That’s the hard part. Does this company have a track record of executing?

3. What percentage of their free cash flow am I comfortable with them burning?
If they’re spending 90%+ of FCF on CapEx, that leaves almost nothing for you—no dividends, no buybacks, no safety net.

Don’t Get Swayed by the Noise

You wouldn’t invest in your brother-in-law’s sketchy business venture just because he sounds confident, right?

So don’t let headlines, analyst reports, or charismatic executives convince you to ignore red flags.

Big Tech might be making massive AI bets—and some will pay off spectacularly. But that doesn’t mean every company pouring money into CapEx deserves your trust.

You’re an Independent Investor—Act Like One

Do your own research. Set your own comfort levels. And remember: CapEx isn’t inherently good or bad. It’s a bet. And every bet has a risk.

Now go read that next Yahoo Finance article about Amazon’s CapEx with confidence—because you actually understand what’s at stake.

In all seriousness, last week was a bad one for everybody no matter where you were invested in. AI and software focused technology was certainly hit the hardest, alongside Bitcoin. Last week the Nasdaq fell 2.7% and the S&P 0.9%, and the Dow decided to be the hero in the index industry by gaining 1.3%. Bitcoin usually follows the Nasdaq with more volatility loosely. However, last week was certainly a bigger drop than one could’ve predicted, losing ~9% alone.

However, does choppy waves change the enthusiasm of a sailor? Hopefully not, and I haven’t lost a drop of conviction in any positions. In fact, a new position was added to the portfolio that’s already up 4.5% (un-leveraged!)since purchasing Thursday. First we’ll review how much the uncertainty risk management strategy saved the portfolio’s butt last week.

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Bitcoin, created by an unknown person under the pseudonym Satoshi Nakamoto, has evolved from an experiment gone right, to one of the most valuable assets in the world. With a disgustingly large all-time gain, creating countless millionaires, lots of headlines surrounding it, controversial opinions, and a sprinkle of political influence it’s extremely difficult to understand Bitcoin in general, let alone whether it’s a good investment, how crypto is different from stocks, and what is supporting this seemingly sketchy ‘pool of money’.

Simply, I am going to lay out the facts about Bitcoin that make me bullish on it and leave it to your interpretation to invest in Bitcoin at your own risk.

Bitcoin’s Fundamentals

I use the term fundamentals quite often in my articles when I refer to the basic statistics of a business’ stock. However, Bitcoin isn’t a stock, rather more of a digital commodity (digital gold for example). Which, on the surface makes it seem like there’s no fundamentals to cover, just as what could be argued for gold investors. I assure you, reader, Bitcoin has fundamentals, they just differ from the usual basic business statistics stock investors breathe in like oxygen. Let’s review the available information for Bitcoin:

• Scarcity and ‘Market Cap’: Only 21 million Bitcoin will ever exist, which creates a scarcity, similar to gold.

• Decentralization: Unlike stocks or a flat currency, Bitcoin isn’t tied down to a single company or the government (despite what the media may say).

• Transparent yet Secure: The “Blockchain”—a public digital ledger used to record crypto transactions—ensures open verification, so Bitcoin doesn’t require a balance sheet, can’t be manipulated, nor come with ‘hidden’ risks.

• The Network Effect: The more Bitcoin is adopted amongst society, the more utility it has. It’s already used for transactions, payments, assets, etc. Who knows what it can grow to as more people adopt the idea?

The Case for Bitcoin’s Future

As the last bullet point suggests, Bitcoin unlocks more utility and potential as more people acquire it, pump the value, and adopt the idea. One could ask: “What has Bitcoin done utility wise since its inception and being adopted in society thus far?”.

• Created digital payment that is quicker than debit or credit cards.

• Fraud-less transactions as a recipient/sender wallet ID contains no personal information tied to any transactions.

• Countless businesses adopting it as the preferred online currency, such as Namecheap and overstock.com.

I believe this is more than enough proof that Bitcoin’s utility is revolutionary this far. But I want to continue this trend into the future and communicate why Bitcoin is a great store of value on top of its technological innovation.

Like gold in the 1970’s, Bitcoin’s function isn’t only a vehicle for storing value, but it’s becoming an everyday utility more and more as time goes on. I believe Bitcoin is the only relevant digital asset in this time. It can be used as both: a reserve asset that companies like Tesla, MicroStrategy, and many financial institutions use; plus a way to pay your friend instantly who you lost a bet to.

You don’t see people walking around with ounces of gold when they are planning to pay for a big purchase, nor stacks of cash in duffle bags—that is, assuming you’re not a criminal—we all have credit cards and debit cards. While this in itself was revolutionary technology, look at the dying asset they are tied to: the United States Dollar. Don’t believe me that the USD is a dying currency? Let’s take a look.

As you can see, since the criminalization of possessing gold, the USD has been on a linear decline since, due to inflation. Even when the gold standard was introduced, the USD was quickly losing value over the years.

With all this in mind, the main aspect of decentralization of Bitcoin seems like a no brainer if we want a currency that stays stable or even appreciates.

Bitcoin as an Equity, Not a Short Term Investment

The current and future utility of Bitcoin (the driver of its appreciation) is what makes true Bitcoin holders long-term believers, not short term day-traders of the coin. Bitcoin necessary adaptation reminds me of early internet stocks: volatile, not fully understood, controversial, but undoubtedly where the future is going. Therefore, those who understood the fundamentals reviewed earlier in the article before mass adoption gain the most out of anybody (such as the buyers when Bitcoin was literally pennies a coin!). So, by buying Bitcoin, you are hedging against inflation and monetary debasement, shifting from the systemic narrative assets, all while having it conveniently stored digitally and given/received instantly.

The lack of correlation Bitcoin has with other equities isn’t a defect but a strength. The ‘fundamentals’ of Bitcoin are the exact aspects that make gold, silver, and platinum so valuable, except Bitcoin is modern and not the same trading tool the Egyptians used. Bitcoin isn’t a scam, nor just another asset—it’s the evolution of money and I don’t want to be left behind; I hope you don’t either.

This week has had little momentum for the portfolio. Unfortunately, our METU position closed hitting out 10% stop loss the week before META rallies 8% and another 10% post earnings. However, we cannot look at missed gains as losses, nor the risk management strategy that did its job. If you recall, the stop loss was set at our purchase price after we gained 10%, so we have nothing to cry over.

Next, as mentioned in my last update, with the uncertainty in the market I’m being more aggressive in taking gains from my leveraged shares. So, the first trim zone for NVDA hit at around a 15% gain of $80. The remaining shares are up 18.12% unrealized and the next trim zone will be at a minimum of +20%.

Finally, with the dip of Bitcoin and newly found cash after selling NVDL, I made another purchase of Bitcoin of 0.006 at $84,675 for $508. At the time of writing, Bitcoin is at $77,778 and I’m kicking myself for not waiting an extra day. However, with the new Federal Reserve chair, Kevin Warsh, being bullish on BTC himself, I’m confident in the mid-long term success of Bitcoin.

Here is the current state of the portfolio:

Time To Go Shopping

As one could conclude by the title, with the $2,136 in cash currently and the discount some quality stocks are on right now purchases will likely be made going into next week.

Some of these stocks are down in what I believe is a generational buying opportunity that has hardly occurred before. Such as this software giant analysts predict to gain 45% this year:

Salesforce (CRM)

Software in general has been taking a beating the past month. So all eyes are on Salesforce as being one of the biggest software businesses out there. The rumors through the grapevine are that software will become irrelevant with AI…

Which might be one of the most bewildering statements I have encountered in scouring the internet. The very thing that built AI being the same thing that crumbles in the face of it seems impossible, because it is. As long as software businesses are adopting AI (like Salesforce undoubtedly is), this whole outshining the creator paradigm is a nothing burger. But don’t take my advice on it, let’s look at the business statistics for Salesforce:

Does this look like a dying business to you? It sure doesn’t to me! These are just the earnings trends, if we look at the statistics of CRM it continues looking better:

As you can see from the underlined parts, the P/E ratios, PEG, and price/sale have never been lower across the past year and a quarter.

Enough said here, let’s move on to the other stock I’ll be eyeing this week.

Adobe (ADBE)

Another software business that has been tumbling down for a while now. While I can’t say I’ve always been bullish on ADBE, I’ve had a change of heart after doing my own research. They’ve had a lot of competition that are purely AI driven which has created lots of recent uncertainty for the stock. However, are we going to act like Adobe isn’t adopting AI themselves? Plus the fact that they are a household name in the software industry.

Again, enough talk, let’s look at some numbers that can break down how legit this company actually is.

Almost exactly similar to Salesforce, ADBE is (second to) the lowest price it’s been the past year and a quarter.

“Why be Bullish on a Tumbling Stock?”

A great question, and very relevant for both ADBE and CRM. Here’s my short answer: I don’t care if a stocks chart looks like this:

If I see the business statistics look like this:

Conclusion

I’m heavily looking forward to potentially making some moves next week. Before anyone asks, I most likely will be using leverage if I am to purchase either of these stocks; but I will have to do more research on how everything will be laid out.

Thank you for reading, leave any questions you may have below.

Cheers!

1. Scale in with levels and DCA, not a one-time purchase

2. Partial profit-taking is mandatory

3. Stop losses are mandatory if leverage is used

Let’s dive into these last 2 companies and how I will be trading them.

Bitfarms (BITF)

Bitfarms is certainly in the “speculative industry” category, not one I’m exactly used to. So, with this bitcoin miner going into a full data center, I’ll treat it as the trading vehicle it’s supposed to be and be rather aggressive, unlike the other Mag 7 stocks on the list. As previously mentioned, Bitfarms is moving all of its high computing from bitcoin mining to data centers, which will likely be occupied by a large AI giant willing to pay a pretty penny for the pre-built infrastructure. This was stated to switch in 2027, but anything can happen in the time leading up to this, which is why I label it as speculative. The percentage of capital you spend should be less than what you would spend on a ‘normal’ holding, but enough that you would be happy with the potentially much higher percentage gains; for me, this is around 4-5% of my portfolio.

Entry

• A dynamic entry point is mandatory, likely 30-50% down from recent local highs but still able to keep the lights on.

• Another dynamic entry point is when Bitcoin is going through a downturn—Bitfarms is likely as well, making it a more optimal buy point. Try to shoot for around 20% down from local highs.

Exit

• Based on my research, many people recommend taking profit every 25-40% move up in speculative stocks. Again, this should be dynamic and not a stock you’re married to.

• As for me, I will likely sell partially every 50% gain as I’m very bullish on this stock in the coming years (if you are familiar with IREN, you can understand why).

If anything from the industry Bitfarms is in, the high beta it has, or the expected down/up swings it will have scares you, I would not buy this stock. It’s definitely not a usual holding that I write over. It’s the ‘swing’ side in ‘swing-to-position’.

Alphabet (GOOG)

Back to the more ‘normal’ Monk Investments stocks: Google is often called the “King of all AI trades” for 2026. This makes plenty of sense if we look at the data: many people switching from ChatGPT to Gemini, constant infrastructure development, and the many, many more applications Google is piecing together in their unbeatable moat. With a strong rally in 2025, it’s hard to say where’s where for entry and exit points for Alphabet stock. However, one thing remains: bullish conviction for a growing company.

Entry

• Tier 1: Start around $325-335 with 50-65% capital. This is at least a couple of percent lower than its current price at the time of writing. However, it’s had a close to 8% rally to start 2026, so it’s not unreasonable for it to level out in this range.

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The reason why this matters for beginners is that it’s easy to be swayed one way or another and close off investing or trading ideology from the other. Here is a visual of the risk-return continuum:

Here’s My Hook:

Imagine an investor puts $100,000 split into a high-yield savings account, bonds, and treasury bills. His returns are low, but he also knows himself and how he can’t handle additional risk. Another investor invests $100,000 in individual growth stocks and engages in a lot of mid-term swing trading. He’s watched his account dip down 40% twice and held all positions during this, and he couldn’t be happier with the current state of his account.

You may be thinking I’m going to ask, “Which investor has made more money?”, but my point is better proven by asking, “Which investor was able to sleep at night?” Both! Neither of these investors did the wrong thing; they both did what was comfortable for them and stuck with their strategy. Both investors could likely learn something from each other. So instead of finding a strategy that is all about the money, buying into the FOMO of a position, ground yourself, and find what works best for you.

Recommended Allocations

Below, I will list three different portfolio setups: conservative, moderate, and growth. These are general investing strategies, and you may find something to like from each one. A strategy is made to be your own if it achieves your vision. Remember, from the two investors, both could likely learn something from each other.

Conservative

• 60-70% in bonds, 30-40% in high dividend mutual funds

• Expected annual return: ~5%

• Worst year loss: -10%

• Sleeps like a baby, never checks the account

Moderate

• 70% in individual stocks, 10-20% bonds, 0-10% cash (for buying power)

• Expected annual return: ~8-9%

• Worst year loss: -25%

• Occasionally, fearful, manageable panic in bad markets

Growth

• 100% in growth stocks

• Expected annual return: 12-20%

• Worst year loss: -45%

• Loves staring at the account all day, constantly looking for opportunities. Couldn't care less if the account is down, it’s seen as a part of the process.

3 Solid Rules for Beginners

Rule 1: Your time horizon changes your gains

It’s a shame to see many new investors put their money in something for 1 month and be disappointed when it’s red. Most of the time, for these people, it’s not a bad stock that made them lose, it’s their rapid timeframe. Here’s a chart to further prove this phenomenon.

So if you’re investing with a 20+ year timeline horizon, the odds are that even with a highly aggressive portfolio, you will make money. On the other hand, if this money is needed within the next year, the odds are in your favor but less likely than what most are comfortable with, so you may want to lean more conservative with your portfolio.

Rule 2: Volatility isn’t a permanent loss

We’ve all grown used to the saying, “the stock market is volatile”, but do we even truly comprehend this with our own portfolio? Think, if a stock dropped 40% in a year, that’s frightening. But if that stock gained 60% the next year, you look like a genius for continuing to hold.

The unfortunate truth is that you have to be emotionally able to look at your money go down during that -40%, and still be confident to enjoy the 60% gain. Another reason why so many beginners don’t make money when they first start investing!

Rule 3: Diversification creates a smooth ride

Another cliche: “Don’t put all your eggs in one basket!” Now, this doesn’t mean you have to get crazy and have 80 different stocks, but it also doesn’t mean $100,000 split into three stocks will suffice. Growth isn’t often straight linear in the stock market, but I prefer it to still be a smooth ride rather than wild swings every day.

I don’t have a specific recommendation on how many holdings are enough to be diversified, as it depends on many things, such as capital, age, investing goals, etc. I encourage you to audit your portfolio and do your own research on what’s best for you!

Don’t Lie to Yourself

As I conclude, I want to assure you that there is no one right way to invest. Incrementally more gains, but sacrificing my sleep is not a worthy trade in my opinion. So map yourself on the arrow and audit your risk tolerance/investing strategy; there are strings attached to the higher-returning strategies.

Risk and reward are two sides of the same coin. Asking “Should I take more risk?” will always lead to justifying dumb decisions in the hopes of making more money. Rather, asking “how much risk can I actually handle without making a wrong decision?” The latter question is the beginning of a real investing plan, fit exactly to what you need.

Individual Leveraged Positions

As I previously touched on in my ‘How I Trade During Tariffs’ newsletter, I recommended not entering any NEW leveraged positions as long as the uncertainty of future tariffs lies ahead. What does this mean for our current portfolio, which is almost entirely comprised of leveraged positions? Great question!

Due to the significantly higher volatility in these times, I will be more aggressive in taking profits on the swingy days that favor my leveraged positions. Thus, lowering my take profits from 3 portions stretched across +20-40% to only 2 portions (minus a ‘runner’ holding) stretching from 15-25%, with room for situational exceptions. Doing this obviously locks in a chunk of profits on a likely up day during uncertainty, banking capital for a future down day to be used as a buying opportunity in unleveraged holdings.

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Tariffs raise costs on imports/exports for those they are imposed on. For the businesses who feel the repercussions of this usually have squeezed margins, reduced trade volumes, and growth scares. Tariffs (obviously) creates trade-policy uncertainty and often causes an initial drop in returns in the market, followed by a partial recover—as learned from last year—but can continue to depress stock prices over the long term since cash flow is being cut. Now, tariffs hit exporters, supply-chain businesses, and other logistic industries usually. However, with the extreme a certain individual in the White House takes tariffs too, a lot more industries such as auto, luxury, and cyclical businesses are hurt pretty heavily.

So let’s learn how to actually MAKE money in these uncertain times.

Current Holdings Check

With tariffs comes a lot of necessary research for independent investors unfortunately. Luckily, none of it is grueling work unless you have countless holdings that all differ heavily. Here’s a quick checklist to run:

• How much revenue comes from the tariff targeted region? (China, parts of Europe, etc.)

• Does the company rely on imported inputs now facing tariffs? (steel, computer chips, etc.)

• Can the company pass the higher prices to customers? If so, will customers leave or seek cheaper competition?

• Look at the balance sheet, can the company ride out a few rough years of lower margins or high uncertainty?

This isn’t a fool-proof checklist, but it should separate the holdings you have into defensive companies—stocks that are safe with things like tariffs going on—or stocks that you should be more wary on and consider taking action.

Don’t Nuke the Portfolio Yet, Adjust This:

Rather than feeling the need to wipe out all of your positions and only buy defensive positions, here’s a way of easily adjusting what you already have.

After completing the checklist, consider trimming oversized positions that you would consider a highly exposed name. Trim them back to what is ‘normal sizing’ for your portfolio at minimum.

Don’t just sit on cash and tell yourself there’s nothing you can do because tariffs are unpredictable. There are actions that can be taken. With your capital, you can lean into sectors that historically buffer trade stress (quality factors, defensive stock, or domestic only businesses), buy commodities that may benefit from the chaos (gold historically thrives in uncertainty for example), or you can try and play the game— conspire what businesses may rely on when uncertainty hits them (whether they have to adjust or make sacrifices, and where they would go to fix such). The last option is risky, requires lots of listening to the news, and not recommended for majority investors.

Finally, if you are using leverage/options, you may want to consider stopping in the meantime and setting (increased) safety measures for the higher swing positions you already have.

For New Decisions:

Many smart investors see debacles, such as tariff uncertainty, as a grand buying opportunity. This is on the right track of thinking, but there are some housekeeping items you have to keep in check.

• Existing Positions: Did the thesis change, or just the price?

If tariffs directly cut into the future of a position of yours, and it does more structural damage to the business rather than a mere scrape, your decision comes down to how much conviction you have in the business; ask yourself honestly if the company will pull through after the tariff chaos is over, if it will plateau, or if your capital is better spent on a different stock. If confidence is still high, treat tariffs as cyclical noise and do nothing.

• New Entries: Why are you buying it? Did your investing strategy bend to buy it?

Many people will look differently at a stock they’ve never liked, just because it’s trading 20% below what it’s usually at. Any dip a stock has doesn’t automatically make it a ‘buying’ dip. Simply, if you catch yourself going bargain hunting for the sake of finding a bargain, stop yourself. Don’t sacrifice your strategy to find a ‘good deal’ during an uncertain market, spoiler alert: you’ll always find a bargain in a market down turn!

Conclusion

This article was not meant to terrify you over the subject of investing with tariffs; but rather show that tariffs are one risk among many investors have to deal with and that there are ways to keep business as usual. Tariffs aren’t the root of all losses nor the sole driver of returns, it’s certainly a hurdle for investors, but there are many ways to get around a hurdle—it doesn’t mean you have to stop running. I encourage you to audit your positions and your investing ideology as we (yet again) enter a tariff season. Happy investing!

1. Scale in with levels and DCA, not one time purchase

2. Partial profit taking is mandatory

3. Stop losses are mandatory if leverage is used

Nvidia (NVDA)

Analyst see NVDA growing to mid $260s in 12 months with some reaching as high as $275. I think the $260 mark in 12 months is a rather accurate target—give or take a month. However, with NVDA being such a high-volume stock, I believe this chart will look rather messy and will likely be bought/sold multiple times within this year before reaching its price target. So the entry and exit zones will be more aggressive and leaning towards the swing trade side of this strategy. Here are my numbers:

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Nvidia (NVDA) - The Coal to the AI Furnace

1. Designs high-performance chips and platforms for complex computing workloads, including, AI, data centers, and bitcoin mining.

2. People love Nvidia for its massive upward trend seen the last 5 years, but also its cash generator, CUDA (Compute Unified Device Architecture), giving the company exceptional margins with growing revenue.

3. Despite its rapid growth, I believe Nvidia is set up for even more success. Many others agree, such as Wall Street outlooks seeing the strong (and growing) AI market being fed by the computer hardware Nvidia provides. I’m sure I’m not the first to think of this simile, but Nvidia is selling picks and shovels in the AI goldmine—indispensable hardware that everyone needs to achieve anything AI related.

Amazon (AMZN) - One Word, AWS

1. Everything. Global e-commerce platform, logistics, cloud services, ads, streaming services, I’m missing more.

2. Amazon is a stock that just makes sense. A. We can’t imagine our life without Amazon. B. If you can imagine a company with it, Amazon most likely owns it. More than this, Amazon has unbeatable aspects such as its logistics moat, the e-commerce at your front door every day, but most importantly, Amazon Web Services.

3. AWS is what sets up Amazon for success in 2026. If we look at the chart below, it’s clear that Amazon is the chosen web provider for a large majority of software focused businesses. With the exception of the growing Google (which is also on this short list), Amazon’s equity in the web services space is growing rapidly with no competition. This is without a doubt Amazon’s current bread and butter, and it will only grow more rapidly as we see more and more AI startups launching. If you want to see more number focused metrics for Amazon, I recommend checking out a prior post I made breaking it down.

Bitfarms (BITF) - Bitcoin Gone AI

1. Bitfarms is a bitcoin mining company operating its facilities by low-cost energy, (currently) earning revenue through block rewards and transaction fees from the bitcoin mined.

2. Bitfarms has been shown some love recently for a few reasons: people are getting more bullish on bitcoin and the access to cheap energy Bitfarms has makes it a more scaleable facility compared to most.

3. With all this being said, I believe the most important part (that I haven’t mentioned) about Bitfarms is their active transition from mining facilities to HPC/AI data centers; ‘winding down’ their crypto mining by 2027 to focus on this AI infrastructure. I think this sets this company up for massive success—as we’ve already seen there’s a high demand for data centers from all cloud providers (AWS, Azure, Google Cloud, Oracle, etc.), Social Media (Meta, Apple), and of course the AI giants (Nvidia, AMD). Many of the mentioned companies have plans to build the infrastructure needed, but nothing can ever be built fast enough, so the likely hood of Bitfarms outsourcing, selling off assets, or even being bought are extremely high as infrastructure demand increases.

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   Alphabet (GOOG) - The Mother of all Moats

1. Operates your preferred search engine, owns your favorite entertainment site (YouTube), Android, Cloud Services, and the newest kid on the block: Gemini.

2. People love Google for its massive data and distribution moat, with crazy amounts of cash flow from the miscellaneous cash producing income streams Alphabet has. What people are very excited about is the ongoing investment in AI and Alphabets other new AI driven products; Gemini has been such a hit that we’ve seen a pretty major decline in the amount of ChatGPT users, as they’ve switched to Gemini as their preferred LLM.

3. It’s a large statement to say that Alphabet stock will continue to rally upward with it already up around 85% the past 6 months, but I’m willing to make that statement. I would be surprised if the rapid momentum itself continues, but it’s almost a no brainer that Google will continue in the green through 2026. My reasoning behind its 2026 set up is driven by Alphabets terrific ability to monetize almost everything—and I think an upgrade in the monetization for Gemini is due. But as their AI powered tools continue to mature, GOOG has much in its favor with growing demand, smarter tools, and terrific margins.

There’s my short list for 2026. If you want to see me break down what my personal entry and exit points I’m planning for some of these positions are, further thoughts on my convictions/thesis for the businesses, etc. make sure to upgrade to the paid subscription for only $6.99/month and a newsletter with such will hit your inbox soon.

Housing Health Report

If every stock—and the company behind it—became a house, almost anyone could judge it without any fancy finance terminology. Here are a few common stock events translated into everyday housing problems:

• Leaky roof – Did the company miss earnings? A small puddle after a storm isn’t a big deal, unless you’re constantly patching leaks and ignoring deeper structural issues.

• Curb appeal upgrade – Management can sometimes slap fresh paint on the story, pushing the stock up 5–10% with flashy headlines, even when nothing truly meaningful has changed underneath.

• Cracked driveway – Sector rotation can look ugly, but like a cracked driveway, it rarely justifies a full sale on its own. The market will always chase shiny “flips” over solid family homes, yet quality tends to rebound over time.

These are just a few metaphors, but you can easily build your own. Think of a stock you’re eyeing and be brutally honest: is it an attractive buy because it’s on sale and just needs some work, or is it unbelievably cheap because it’s begging to be bulldozed?

Money Pit vs. Fixable

Money Pit Warning Signs

• Mold – Mold is scary in any amount, but a small spot on some drywall is very different from entire walls being covered. In stock terms, think shrinking profit margins, declining revenue, or steadily rising debt. In the short term, these can be explained away and spun to keep shareholders hopeful, but dragged out for too long, the whole “house” can become hopeless.

• Crumbling foundation – Cash is the foundation of a business. If a company is consistently burning more cash than it earns year after year, it doesn’t matter how nice the house looks from the street—it’s going to fail inspection sooner or later.

• Caving roof – A caving roof is a sunk cost that scares off any reasonable buyer. Here, debt is the water and earnings are the roof: a rainstorm on a strong, well-built roof is fine, but a downpour on a duct-taped roof is a disaster. Companies that keep borrowing just to stay alive, with no clear path to real earnings, fit this description.

Fixable Annoyances

• Cosmetic scratches – Scratches show up on almost any solid family home. They don’t mean the home is trashed—just that it isn’t Instagram-perfect. Likewise, a fundamentally strong stock dropping 10–15% with no real change in the business is usually cosmetic. If the company is still growing and attractive, the lower price simply means more opportunity.

• Recoverable natural disaster – Living in tornado alley, think of a weak tornado that tears off a few shingles: nobody immediately lists the house because of that. In the same way, a company missing Wall Street’s quarterly expectations doesn’t automatically deserve to be dumped. Storms happen, but a business’s mission and long-term value aren’t defined by one quarter.

In a Nutshell…

It doesn’t take a finance degree to understand the basics of stock evaluation when you translate them into house problems. Now, when you look at your portfolio, you can ask, “Do I really need to bulldoze this position just because the sprinklers are broken?” As the market throws storms, broken HVACs, or a little mold at your holdings, pause and resist the urge to panic when nothing truly fundamental has changed. Just like with real houses, patiently caring for a handful of good “homes” will build value far more reliably than constantly chasing the next flashy mansion across town.

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