Wall Street’s No. 1 Mistake: Ignoring Long-Term Profits
Last week, the world got a little bit of something we all needed this year…
Pfizer announced that its COVID-19 vaccine is 90% effective in testing so far. Those results were much better than anticipated. And it’s possible that it could get the green light from regulators by the end of this month.
Now, it’ll likely take more than a year before enough vaccines are produced for the global population. But it’s a start. We’re one step closer to ending this pandemic.
It’s great news for the world … but it hasn’t exactly been great news for the market.
After Pfizer’s vaccine news broke, Wall Street traders went to work. They figured that a vaccine meant people would soon be able to go back out. People would be itching to go to work, school, restaurants, gyms and movie theaters.
All of a sudden, stocks that were hurt most by the pandemic — like travel and energy — were soaring. ExxonMobil was up 13%. Delta Airlines gained 17%. And Carnival Cruise saw a 39% boost.
On the flip side, businesses supporting our new remote world suffered losses that day. High-flyers like Zoom Video and Netflix dropped 17% and almost 9%, respectively.
But this kind of market movement is absolutely silly. And it shouldn’t change the way you handle your portfolio at all. Here’s why…
Wall Street Is Looking the Wrong Direction — As Usual
For one, the vaccine is still a work in progress. It’ll be a while before we can use it worldwide. People won’t be rushing back outside just yet.
And even with a vaccine, people will still want convenience. They’ll still watch Netflix on their own time and use Zoom to connect with friends and loved ones halfway across the world.
The bottom line: Nothing has changed in the fundamentals of these businesses to justify such big changes in their stock prices in one day. These day-to-day movements are just noise.
So, you shouldn’t worry about short-term swings in your portfolio. At the end of the day, the path to profits and making life-changing wealth is over the long term. And over longer periods of time, it’s the fundamentals of the business that move the stock price higher or lower.
Take PayPal, for example. It dropped almost 9% the day of the Pfizer’s vaccine news.
But what about the fundamentals of its business?
As an online payments company, it’s been tapping into the huge e-commerce market. Sure, the pandemic gave online sales a boost as people shopped more on the web than in-store.
Yet even before then, global retail e-commerce sales hit $3.5 trillion in 2019. Not billion … trillion. And that number is projected to hit $6.5 trillion by 2023.
So, e-commerce isn’t going to slow down just because stores reopen. And PayPal will still be an essential player in the space.
Not to mention, it’s constantly rolling out new, convenient services to its users. It’s offering the ability to buy and sell cryptocurrencies … “buy now and pay later” in installments … and much more. This is a company that adapts to growing industry trends and provides what its customers want and need.
People aren’t going to quit using PayPal just because of a vaccine. And that 9% drop is nothing when you look at the long-term growth of its stock:
It’s still up 72% on the year. Since being publicly listed in 2015, it’s made total gains of 444%. That’s enough to turn an investment of $1,000 into over $5,000.
Now, I’m not telling you to buy PayPal today. But there is a chance to make those same kinds of profits again today. And I want to show you how…
A History of Overlooking Profits
You see, Wall Street traders and analysts constantly make the mistake of not looking at the bigger picture. Instead of being patient, they walk away from long-term opportunities.
But the biggest players on Wall Street — billionaires like Warren Buffett — know better. They invest for the long run … and take advantage of special situations in the market.
And there are plenty of special-situation opportunities out there. In fact, PayPal was one of them. Back when the company was first publicly listed, you could’ve essentially gotten shares for “free”…
You didn’t have to figure out when to buy or what price would be the best bargain to buy at. Once you got your shares, all you had to do was sit and let time do the heavy lifting.
Of course, these billionaires know that special situations like this aren’t easy to find. They keep them to themselves, so they can profit while keeping Main Street investors in the dark.
But here’s the thing: We could see record numbers of these types of stocks in 2021. So, it’s more important than ever to know exactly how to spot them to turn the tables and grow your nest egg.
That’s why I’ve been working nonstop on an important project called the Profits of a Lifetime Summit.
Because with my 37 years of investing experience, I know how to find these special-situation stocks. In fact, I’m seeing three of them in the market right now.
And I don’t want everyday investors like you to miss out on the chance to pick up these “free” shares and the profits they can bring you.
So, I’m revealing all the details during my event on Thursday, November 19. I’ll share everything you need to know about special-situation stocks and how to find them.
Be sure to sign up for exclusive access to it now. You won’t want to miss it.
Editor, Alpha Investor Report