“The stock market is a device for transferring money from the impatient to the patient.”
– Warren Buffett
This is gonna be a hard one to talk about.
It happened years ago, but it still feels fresh.
Let’s rip off the Band-Aid, shall we?
I lost $70,000 in one day through an options trading strategy.
My book, Fire Yourself, has all the details.
But I still learned some important lessons I want to share here today.
For a couple of months, the strategy worked really well.
I made about $20,000.
Then, the market closed.
It happened when I was still selling medical supplies.
I sat outside a hospital with my laptop open and realized I’d lost $70,000 in a single day.
Feelings of shame and disappointment and defeat all went through me at that moment.
That was a really difficult day.
But everything happens for a reason.
Today, I’m going over three of the most important things I learned from that experience.
Let’s dive in!
1. The $70K Loss—What Happened?
So, let’s address the elephant in the room.
What happened?
How did I lose that much money in a day?
Well, that was the day I learned that I’m not a good options trader.
And I’m okay saying that.
No one can be great at everything.
We all have our strengths.
When we lean into those strengths, that’s when the magic happens!
2. Why Stock Market “Gambling” Doesn’t Work
Stock market gambling doesn’t work.
I was in options trading, but this advice can apply to trading stocks as well.
If you have a money person, you should check your allocations.
You could be heavily invested in stocks without even realizing!
It’s a challenging place to be in.
There is a 97% chance your investments won’t beat the indexes.
They will lose money.1
The stock market is a tough house to beat.
The fees alone are ridiculous.
Even if it’s a low-cost index fund—it’s better, but it’s still not as good.
This is why the stock market has so much volatility.
Thankfully, I think people are starting to realize this.
You won’t become wealthy by gambling in the stock market.
If you have wealth, you might be able to maintain that wealth.
But even then, that volatility will likely catch up with you.
I’m personally not a fan of weathering volatility.
If you can find other ways to grow your wealth, do that.
3. The Secret
The biggest secret I learned after losing $70,000 is finding out your edge.
Figure out what you’re good at, something that makes you competitive and durable.
My unique ability is clearly not in trading options, right?
That’s something that I learned quickly.
However, I also learned I’m really good at real estate deals.
I’m really good at analyzing them
I’m really good at looking at cash flow and buying businesses.
I also have a talent for helping investors.
That’s what we’re doing together right now!
Now that I’ve found my edge, I want to do as much with that as I can.
Even though I’m terrible at it, I do think options trading can be great for some people.
It’s just not my gift.
When you find yours, make sure it’s something you want to spend your time on.
If you’re retired, you might not want to deal with stock options and real estate all the time.
In that case, you should find a group like ours that can help.
You can vet the opportunities and invest passively.
Then, you’re getting paid for someone else’s work.
That’s where the idea for my podcast, Mailbox Money, came from.
We talk about those topics.
How do you grow your wealth without taking up more of your time?
Warren Buffett himself talks about making money while you sleep.
When you figure out how to do that, it’s a huge advantage.
Let’s say you have a net worth of $2 million.
You’d qualify for our mastermind called the Wealth Forum.
We get investors together and we ask questions like:
Which deals make sense?
What does our tax strategy look like?
What asset protection should we be doing?
It helps us maximize the advantages we have.
One of those advantages involves alternative assets.
KKR, a private equity group, published a study that shows alternative returns at around 2x.
From 2000 to 2020, the average private equity investments averaged 13.2%.
It was only 6.6% for the stock market during that same 20-year period.2
That 2x difference is why we like this kind of asset so much.
Your edge might be different.
When I was first figuring things out, I asked myself how I could help other people.
Or, how could I help solve other people’s problems?
I recommend you ask yourself similar questions.
You’ll find your niche in no time.
Now I want to hear from you!
How will you go about finding your investing edge?
Let us know in the comments.
Before you leave, make sure to check out our special report about inflation investing. It shares the best choices to invest during an inflationary environment.
If you are interested in investing with us, we are happy to answer any questions that you may have. Join our investment club today and we will be in touch.
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Disclaimer: I am not your investment advisor. This is for educational purposes only. I am not giving specific advice on what you can do. I am simply giving my opinions.
Works Cited
1. “The Data on Day Trading: Separating Myths from Reality.” Current Market Valuation, October 14, 2024. https://www.currentmarketvaluation.com/posts/the-data-on-day-trading.php?utm_source=chatgpt.com.
2. McVey, Henry H. “An Alternative Perspective: Past, Present, and Future.” KKR, January 13, 2025. https://www.kkr.com/insights/alternative-perspective-past-present-future?utm_source=chatgpt.com.
