I have made more money doing nothing than I have ever made doing something. That sounds like a bumper sticker until you sit down and count it. Go back through your own account and add up what your best positions would have returned if you had left them alone. Then compare that to what you took out of them. Most people find the same thing I did. The selling is where the money went. You will make more in a ten day window than you will in the other 242 trading days of the year combined, and I am not exaggerating for effect. The biggest gains happen on massive breakouts, and those breakouts arrive after everybody has gone to sleep and quit. Think about what that means for how you spend your time. If ten days carry the year, then 242 days are spent waiting. And waiting badly is what

  I paid $1.14 for a put and sold it for about six bucks. The company I owned had beaten on revenue. Sales came in ahead of what the street wanted… And the stock had its worst single day in almost five years… That trade is why I want to talk to you today about the only rule I’ve got around earnings, because it’s saved me more money than any prediction I’ve ever made. I rarely hold a stock through earnings. When I do, I buy a put. There’s nothing clever in it and there’s nothing more to it than that. People hear it and assume I’m hedging because I expect bad news. I’m not. I buy the put because I have no idea what the reaction will be, and neither does anybody else. Let me walk you through the Kroger trade, because it’s a perfect example of why. I

  A company said one word on a conference call and the stock dropped 25%. The word was delay. Not a miss, not a guidance cut, just a warning that things were going to take longer than planned… And the chart gave you nothing beforehand. No topping pattern, no divergence, no signal… If you were trading that name off the chart, you were long into it. I want to explain what set the size of that drop, because it was sitting in plain sight and it was not on any chart you own. The chart tells you when. It cannot tell you how far. I have been doing this 40 years and I will put it plainly. Your chart is a timing tool. It is not a risk tool, and most traders size their positions off it anyway. What determines how far a stock can fall is the multiple, meaning