HOW TO MASTER SENTIMENT, EP. 4

Some common questions I get about The Daily Dirtnap. Dear Reader, This is the final episode of "How to Master Sentiment." Tomorrow, you'll receive at least one more email reminding you that the [discounted membership]( I'm offering is off the table on 9/29 at midnight, but this is pretty much "the end." But before we part, I wanted to offer a Q&A covering some common questions people have about The Daily Dirtnap (maybe you've had these as well): Q: I looked up the word "sentiment" and it seems to mean "emotional-mumbo-jumbo"... why is that your investing strategy? A: I'm a master of sentiment investing because I pay attention to how other people are feeling and reacting to the markets. The market runs off human sentiment. Fear causes movement. Excitement and greed cause movement. You and I are here to keep a level head. - Like when the consensus wrote off Beyond Meat (BYND) as a fad, we bought in at $58 and rode it back up to $118 (which handed Daily Dirtnap members a 103% gain). - Or when no one wanted to touch energy and oil was trading at -$37.63 a barrel, we loaded into multiple XLE (Energy Select Sector SPDR Fund) long calls. We cashed those calls out for returns of 248% and 524%. Paying attention to sentiment doesn't always mean you run in the opposite direction, sometimes it means you capitalize on others’ euphoria/greed. - A good example of this is when we bought into Bitcoin at $10K, rode it up to $34K, and sold. I noticed that "Bitcoin euphoria" was reaching its peak again, and I sold. Some people got annoyed at what they saw was me "selling early" but I have zero regrets. Bitcoin has more mood swings than an elderly cat. We got in and out at a great price point and made a 300% gain. Q: You mentioned that the Dirtnap was great for Idea Generation, what does that mean? And, how does it help me? A: Most financial commentary out there exists in an echo chamber of sorts. Not a lot of fresh ideas. The Dirtnap does a couple of things pretty damn well:      Helps you understand human behavior and market sentiment—which is one of the most powerful tools in the investor toolbox. As I mentioned, fear, euphoria, and greed cause movement. "His insight into market psychology is matched only by his wit. He’s a voice worth listening to for any serious student of the markets.”—M.P., Dirtnap Reader & Portfolio Manager      I write in such a way that encourages intellectual flexibility (see: agility), and the removal of bias and emotionality from your investing practice. “It’s a slap in the face… but realizing you needed waking up.”—Terry F., Dirtnap Reader      I also think I do a pretty good job of breaking down complicated ideas—making them bite-sized. You don’t have all morning to read a research paper. I’m here to light up your synapses, and let you get on with your day “[It’s] a look behind the curtain… it has greatly expanded my view of markets, how they work, and the players involved on a day-to-day basis.”—Stanley P., Dirtnap Reader      As far as letters go, The Daily Dirtnap is a different animal. It doesn’t simply share a ticker with you, and split (though I obviously do share what I’m personally investing in, or am interested in). You’re getting a level of qualitative analysis and macro thinking that, frankly, can only be found in the world of “luxury consultancy”—where someone charges you $1,000 to $5,000 for one hour of their expertise. I don't charge anywhere near that, and don’t plan to. Ever. "The Dr. House of trading.”—K.L., Dirtnap Reader & Financial Advisor      I make it fun. My goal is to make my commentary a joy to read, in addition to being super-smart and timely as hell. “I read it as soon as I possibly can after it hits the inbox.”—Stephen H., Dirtnap Reader Q: What if I disagree with one of your calls or opinions? A: Are you going to agree with my every musing? No, of course not. I wouldn't expect you to. I write an idea-generating letter—I'm not running a cult. I value individual thought and opinion. If you disagree with me, and that sparks you to make a profitable play, then I've done my job. Q: I’m a 10th Man reader. Is The Daily Dirtnap really for investors of all experience levels? (This goes for Street Freak and ETF 20/20 readers too.) A: The short answer is “YES”—this letter benefits investors of all experience levels in very distinct ways. If you are a professional or experienced investor, you’ll use it for idea generation. If you are brand new to investing, it will not only help you avoid common pitfalls experienced by new investors, but it will put you lightyears ahead of the newbie who just sits there on Reddit waiting for Wall Street Bets to offer up their latest half-baked, dangerous idea. It may help to hear from two of my readers. One reader is a market professional. The second is actually someone who helps me with some of my writing (blogs, letters, stuff for radio). Full disclosure: She works for Mauldin, yes. But she is incapable of B.S.-ing anyone (which is probably why she was assigned to me). She is also completely new to investing. From a Market Professional… "New ideas/new direction? Absolutely, and in a good way. I've designated myself an "individual investor" above although I am also a financial professional. I am on the buy side of the private credit market, investing primarily in investment-grade corporates and infrastructure projects. Clients are mostly life companies and pension funds. After a ~30-year career in corporate lending, about a year ago I realized I had become too skeptical about everything. I was missing out on great [opportunities] in the equity market because I couldn't take myself out of my professional perspective of "what are they not telling me/lying about'' even when managing my personal investments. Didn't trust anyone. [The Daily Dirtnap] got me out of the trap where I was so focused on "the fundamentals" that I was ignoring great trades that were based on getting ahead of changing sentiment. Shorter version: needed a strong kick in my ass; [The Daily Dirtnap] provided that." —F.W. From someone new to Investing… "I'm actually glad you asked me that. It's not hard for me to read. I like the fact you don't speak down to people. If I don't know what something means, I just Google it. The other day you said someone "went BK" and I had no idea what that meant. Now I know it means bankrupt. Thanks, Google! I'm not going to call myself a 'sophisticated' or even 'semi-intelligent' investor—I'm definitely still learning. But I've read a lot of different letters, and yours gives me a greater understanding of what is actually going on in the markets. Lemme put it this way. Most letters just give you some numbers, a short description, a stock, and then tell you how much you might make off it. You have NO IDEA why they really recommended it to you. NONE. When I read the Dirtnap I know WHY you are choosing a certain direction, WHY an idea might work, and what the overall sentiment is. I find myself understanding how the news might affect my portfolio now. Or... lately... how empty grocery shelves could affect it." —L.J.M. Q: Why should I join today vs. any other time of the year? A: Inflation is having a significant impact on the market. It’s moved from the “fun” phase of benefitting equities, to the “not so fun” phase of harming them. Because of this, we recently unloaded a number of positions before they dropped in value. It is once again time to pivot, and that’s exactly what we are doing. We’re adding pure commodities to the portfolio, and are currently working on an idea related to the China debacle. - I put it this way in Monday’s issue of [The Daily Dirtnap]( titled THE NEXT CRISIS: “China gags, inflation rips, and the Fed panics. Sounds like a recipe for disaster. Let’s make money off of it.” Other than properly positioning yourself for what I see as the next market crisis, there is a second reason to join “now” vs. any other time. I’m offering you a substantial discount on both two-year and one-year memberships. Let me break it down... A 12-month subscription to The Daily Dirtnap (which entitles you to 225 issues) usually goes for $795. If you join today, I’ll immediately knock $100 off. That way, you’ll be able to [join]( for only $695. There is a better deal, though. If you want to go ahead and become a member of The Daily Dirtnap for the next two years, I’ll knock a full $595 off. So, instead of paying $1,590 for 450 issues of The Daily Dirtnap, you can [slide in for just $995](. There are also some pretty sweet bonuses [that you can read about here](. It doesn’t matter to me which deal you choose; I’ll welcome you with open arms either way. This is getting kind of long, so I’ll cut it off here. If you’re interested in seeing around the corner, mastering sentiment, keeping ahead of the trend, and being in constant contact with new ideas and strategies, [then click here](. My offer, including all bonuses, is off the table tomorrow at midnight. Jared Dillian Editor, The 10th Man and The Daily Dirtnap Mauldin Economics Copyright © 2021 Mauldin Economics. All Rights Reserved Mauldin Economics, LLC | PO Box 192495 | Dallas, TX 75219 [Manage your email preferences]( Â