Earn Out Loud
Hey there,
Yesterday, I audited my performance and realized that I’m beating the S&P 500 by 2.10% year-to-date.
Actually, I’ve beaten it every year for four years, except in 2025.
Today, I’ll explain how so you can leverage the strategy for your own portfolio.
Not All Stocks Are Equal
First things first—stocks have categories:
Growth
Conservative
Value
Dividend
Cyclical
And different categories of stocks will outperform under certain market conditions.
For example:
Growth stocks tend to climb faster than other categories when innovation is high and businesses are optimistic.
That’s happening right now with machine learning and artificial intelligence.
So, can you guess where I’ve been investing?
Yep, individual growth stocks. Especially those favoring machine learning and AI.
Big Beginner Insight
Buying good companies is the cornerstone of a good portfolio.
But sometimes the better question is:
“What kind of market are we in right now?”
Cycles of the Market
The market moves in cycles, and you can rotate your investments between categories based on what the market favors.
Pay attention to these market cycles to rotate your investments:
Expansion: when the economy is improving and jobs are growing
Peak: markets are near their highs
Recession: when the economy is cooling and unemployment rises
Recovery: the market hits bottom and the government stimulates the economy
Rotating doesn’t always mean selling everything in one category to invest in another. Sometimes it means investing less in one area so you can invest more in another.
It’s one of the easiest ways to stay on top of benchmark indices.
The Bottom Line
Not all investments are equal.
Some stocks are built for speed. Some are built for stability.
The more you understand those differences, the better your odds of outperforming benchmarks like the S&P 500 and Dow Jones.
What’s Coming for Paid Subscribers
This Saturday, I’ll email you a cheat sheet explaining the stock categories, three stocks for each category, and a description of when they perform best.
Until next time,
-Isaiah from Earn Out Loud