Is this smart?

Let me begin by saying that I genuinely love people. People fascinate me. I love learning what makes people tick (pun intended). Why they make their decisions. What fears do they have? What hopes do they have? What is holding them back? I spent years studying people. Why do successful people succeed at what they do (has nothing to do with wealth) while others constantly fail.

Why Most People Fail In The Stock Market:

There is an old Wall Street adage that says, making money on Wall Street is simple, not easy. I couldn’t agree more. After studying countless people and I’ve learned that most people fail because they make emotional, not rational, decisions on Wall Street. Most people love money (even though money doesn’t know or love them). So they invariably make emotional decisions when their money is on the line day in and day out. Instead of looking at the chart to see if anything went wrong, they look at their balance tick higher and lower. Then end up making hasty decisions and either hold on to their losers or sell their winners too soon (successful investors do the exact opposite).

Profits Are A Function of Time:

I believe in transparency and accountability. That is why Midas Wave Alert members have heard me say countless times that Profits Are A Function of Time. Remember, no matter what you investment style, or how fast you want to buy and sell. Every trade needs a certain element of time before it becomes profitable. Jesse Livermore, one of the greatest speculators of the 20th century, said it best: Big money is made by “sitting.” What does he mean? He means, once you buy a strong leading stock, the big money is made by holding it.  That doesn’t mean buy and hold forever, No. It means give the stock the bullish benefit of the doubt as long as it is going in your favor and always cut your losses. Midas Wave Alert Members see this in real time.

Because I believe in transparency and accountability.

Here are some facts for your review:

• Every stock in the MWA portfolio is profitable – and  up double digits
• There have been less than 10 well-picked trades in the past 6 months- all are up double digits from entry
• The average gain in the portfolio right now is 26%. Meanwhile, the S&P 500 is up less ~1% in 2014. Results are results. Period.
• There are zero losing trades in the portfolio right now.
• Bottom line, MWA members are seeing in real-time how to make big money on Wall Street. I am patient with my winners and impatient with the losers.

Quality Beats Quantity- Every time

Keep in mind, there are no free lunches on Wall Street. That is why I believe strongly in being very selective whenever I buy a stock. I look for quality and know that it beats quantity- every time. Remember, don’t be a sucker. In your everyday life- everyone all day is trying to sell you something. And you know when someone is trying to pull a fast one on you. Well, Wall Street is a little different. When you buy a stock, someone is selling it to you. Except, unlike in day-to-day transactions, the seller doesn’t have to say a word. All she has to do is agree to sell you stock at the price you want to pay. So before you buy a stock always ask yourself. Why is this person selling it to me? Why are they getting out and is it good idea for me to get in? Most of the time if you do your homework and buy quality stocks, respect risk, you will do very well in the long run.

Stupid Is As Stupid Does.

Another reason why most people fail in this business is because they don’t make smart decisions (trying to put this nicely). Full disclosure, I do not trade in penny stocks, they never appealed to me, nor do I have any interest in trading them. So when I saw this headline earlier this week, I couldn’t help but think- Really? Why would anyone in their right mind in today’s day and age fall for this nonsense??? But they do. Another adage says: “There’s a sucker born every minute.”

My Solution: Always ask, Is This Smart?

My solution is to always ask myself (in life and in markets) Is this smart? Before I make any decision, large or small. Try this for a month, and you will be AMAZED and how often you catch yourself making “questionable” decisions. Next time you buy or sell a stock- ask yourself is this smart?

Note from Editor: Adam is the CNBC-quoted hedge fund manager and trading genius whose recommendations were actually UP 55% in 2008 and continues to provide great profits for subscribers to his Midas Wave Alert service.