The Index Fund Blind Spot

SPEAKER_00 0:00

Right now, you own one stock that's up 523% last year, and you own one stock that's down 54% right now. And you'd be like, no, no, I don't. But you own the index, right? You own some sort of index fund either directly or you're in a 401k. And that's what's happening. And literally, as I was putting on my my um black tie here, I was thinking this is probably the biggest oversight in everybody's investment plan. Because most investors have no idea they're holding the losers right alongside the winners. So I thought off the cuff from the beautiful south of France can here, I'm gonna walk you through this for the next 15 minutes or so. So it really, really lands for you. Because half of your portfolio is dying, and that part matters tremendously because it really impacts your outcomes. And what you do with that information could literally define the next decade of your wealth, your retirement, everything else. And if you're wondering who the heck I am, my name is Felix. Um, I'm live here from Cannes, we're at the Film Festival, but I'm also an economist and an ex-banker, and I'm also the founder of the Goat Academy. We've taught uh my retired mentors have taught over 20,000 people the last six years, uh, and that's really what we do here. So the mission is very simple show you guys what Wall Street isn't showing you, so you have the same tools and the same skills as those buggers, right? So I'm gonna walk you through what financial media won't tell you because it undermines their favorite narrative. Now, this video might be a little disorganized and it might be rather full of information at the same time. So I will put together a full breakdown for you, a full research report of everything that I'm covering here and more. We're gonna talk about a bunch of stocks, the tickers will be in there, everything will be in there. Um, and you can download it and the link is down below in the description. So it says so grab that, it's completely free. Um, no, no uh strings attached to that one. And honestly, I just want you to have the full picture. The data, the charts, every ticker I'm gonna mention, it's it's all in there, right? So the SP 500 is up about 9% this year, which is pretty good. NASDAQ is approaching uh all-time highs, Dow hitting about 50,000 almost, right? And last quarter, the vast majority of SP companies beat their profit estimates, like 84%, which is the highest weight we've seen since like the 2021 boom days where the government was handing out free money. So you read the headlines, everything looks freaking fantastic. Absolutely amazing, as glorious as uh can is here behind me. And that's where investors make their biggest mistake. You see all-time hives, you feel good, and then you do nothing. But what's happening underneath the headlines is a very, very, very different story. So I track once a week 150 industries across the entire US stock market. Sounds like a lot of work, takes me about half an hour. And right now, 55% of those industries are really strong. They're climbing up, lots of money pouring in, looking great. 64 industries are going downhill. They are declining, the money is leaving the building. And it means that more industries are falling apart than there are going up, even though we're at all-time highs. So let me give you a real example. Micron technology, right? Micron is up from its lows 523%. And then Nike's Nike, the guys who make your trainers, they're down 54% in the same time period. They are both in the SP 500, then the same index, same time period, massively different outcomes. So if you bought the index fund, the SP 500, you own them both. Micron's pulling your portfolio up, Nike is dragging it down as hard as it possibly can. And you gotta ask yourself, is that really the best you can do? Which is what I'm saying to the wind behind you who's viciously attacking the hair. Now, we're gonna go much deeper on this, really into depth on this on Saturday. So for the first time ever, actually, I'm gonna run a free live session called Why Buy and Hold is Dead in 2026 and what Wall Street does instead. It's live, it's free, it's this Saturday. I'll be broadcasting it live here from France without the wind, hopefully. And there's a link down below and it's called buyandgrow.net. And that's really the intention, buy at grow.net. So grab yourself a seat for that. It works whether you're in the US or in Europe, wherever you are, because I'm in your sort of time zone this week, but I'm a little getting ahead of myself. Let me first of all show you why this matters so much right now, right? So, what's happening now is not a market crash. If it were a crash, everything was going down. What's happening is a rotation, a rotation. Uh, money is moving out of certain sectors and it's flooding into others. So think of it as a giant swimming pool with different sections. The total amount of water stays the same, just the index. But one end is getting deeper while the other end is draining. So the SP being an all-time eyes tells you the pool's full. It doesn't tell you which end the water is going into. So energy stocks are up 28% today, this year, best performing sector in the US. Healthcare is down 6%, and Nanchots are down 6%. Okay, same market, very, very different outcomes. Tech's up 16%, big materials are upper 14%. So the money is going somewhere very specific. And if you're not paying attention to where, you kind of missed along for the ride, the ups and the downs, right? So there are basically one, two, three things that are driving this. The first one is inflation is back, baby. CPI, which is the official government measure for how fast prices are rising, is at 3.8%. 2% is the target, right? Um, energy costs are up 18%, that's gonna get a lot worse. Gas is up 28%. Um, so you're probably feeling that, right? And if you're feeling that, put it down below in the comments, just put feeling in there, and people are gonna wonder what you guys are feeling. Um, the Fed wants 2%. So we're at double the inflation that they want. And when that happens, hard assets and commodities win. The paper-based stuff loses money. Now, the second thing that really matters here, and it's a number that you've probably never heard of, it's called NAAIM. You might want to write that down. I feel like I'm clinging on for dear life here. Um it's called N-A-A-I-M, and it's um it's a survey of professional money managers, which is sort of ironic in itself, and it tells you how much of their clients' money is invested in in stocks right now. Um, and right now it is 97 out of 100. So 97% of all money managers are all in. Um, the way I picture that is uh game of musical chairs, right? 97 people are sitting down already, and there are three chairs left. So when nearly everybody is fully invested, there is basically no new money left to push prices higher. The direction of money where it flows matters far, far, far more than whether more comes in. And the third point here is real wages. Real wages means what you actually earn after inflation. And right now that number is negative. So you're earning less this year than you were earning last year. How does that make you feel? Angry? Pissed off? Yeah, something like that, probably, right? So Americans are getting poorer even if their paychecks are going up because prices are rising faster than pay. And that's the silent tax on the consumer. Um, and all consumer-facing industries, retail, advertising, all of them, they're feeling the pain. Hence Nike, maybe. Um, but they're winners. And I want to walk you through a bunch of them. I'm gonna give you some actual stocks and some tickets, and hopefully, my team will put some data on the on the on the edit here for you so it becomes a bit more valuable for you. The first I want to mention is just gold. Gold's a safe haven in times of inflation. Uh now you can buy gold, and I'm all for that. But again, I'm not telling you what to do. I'm not a registered financial advisor and all that stuff. I'm just giving you my thoughts and my research, right? Um, a stock I like is called NEM, Newmont. Because gold's at you know, 4,700 or something. It's up almost 50% in the last year. Um, and there are three things that are pushing gold. Central banks are holding it. We're expecting about a thousand tons of gold buying from central banks this year, which is just crazy. China, India, Turkey, Saudis, they're all switching their dollars for uh for gold. And it tells you a lot about where the world where the world is heading, really, because these guys are the ones creating the inflation, right? They're the ones printing the money. Um, cash means you're losing guaranteed because inflation will make it worth less. And gold's the ultimate inflation hedge. It always has been. I think it probably will be for the next 5,000 years as well. And gold miners, like NEM, are doing even better than gold. So there's an index for the gold miners, it's called GDX. It's running well above its long-term averages. And when the miners outperform the metal, it usually tells you there is some some legs here. So who are Newmont, the largest gold miner on the planet? Massive company, 100 billion plus. Not one of these, you know, or maybe they'll find gold type type type deals. They're a blue chip gold miner, basically, right? And if you join me on Saturday, we'll look at the chart together of that stock and some of the other ones we're talking here because that actually tells me where the money is flowing and why it's coming in and the exact price point we might want to be looking at. I'm going to teach all you all of that to you on Saturday if you join the uh why buy and hold is dead in 2026 live training. The second area that I'm looking at is uranium. And it's sort of the stealth play. And my stock pick there is Camiko. CCJ is the ticker symbol. And it's flying under the radar. Uranium is up 21% compared to a year ago. The world's going nuclear, right? China has 60 nuclear reactors running, 38 under construction. The US just classified uranium as a national security asset. Um, tech giants are basically building or signing contracts or small nuclear reactors to pilot power the data centers. And the only way we're going to get the power we want for AI is going to come from nuclear. That's just the tip. Whether you like it or not, that's just the reality. So the US needs about 50 million pounds of uranium per year, and it makes about 1 million of that domestic. So it's a 98% import dependency for something the government calls national security critical item. So uranium mining stocks, there's an ETF for it called URA. That's up 25% so far this year's. Junior miners are up 45%. But my pick is CCJ because it's a$50 billion cup, largest uranium producer in the world. And if uranium is the fuel of the future, then Camiko is going to be supplying it. Third, copper. Copper is like what oil used to be. My stock pick here is, and again, don't buy these things blindly, obviously. Uh read the report, come and join us on Saturday and learn. Is FCX. It's called Freeport McMurrin. And a lot of Wall Street's calling copper the new oil because the entire modern economy runs on it. Copper is up about 40% the last year. Every EV needs four times more copper than a gas car. Every solar panel needs it, every wind turbine needs it, every data center needs it, every power grid upgrade needs it. Bloomberg says the copper market is swinging into a million metric ton deficit, which means there is more demand than the world can produce. And it's gonna get worse, not matter. Production problems in Indonesia, Chile, China is halting exports and lots of things that are needed for copper processing. So the supply here is shrinking, the wind clearly isn't. So uh why FCX? 80 odd billion market cap. It's the closest thing to a pure play copper company on the planet, in my opinion. So when copper wins, FCX wins. There's some other ones, um Southern Copper. The ticker there is SCCO. That's about 160 billion, it's bigger. Uh, also well positioned, I think. So have a look at those. Let me know if this is helpful. Just put a helpful in the chat down below, and I know this is landing for you, and whether it's worth ruining the precious hair over. Um fourth, I think we're at fourth, energy. Um, the stock here I would look at is TTE, Total Energies. Energy overall is up about 20 odd percent so far this year. It's the number one performing sector in the entire SP. So everyone's debating tech stocks and whether they're overvalued. Well, energy has just outperformed everything. So if you know where to look, if you know how to see where the money is flowing, you don't worry about the bubble, you just buy the thing where the money is flowing into, right? And it makes sense. Inflation is driven largely by energy. The companies that produce energy, they're printing money. Yeah. So TTE is the stock I'm looking at here, about a$160 billion company, uh pretty diversified energy giant, oil, gas, renewables, you name it. Um, and money is flowing into it. Just look at the stock chart. Join me Saturday if you don't know what the heck I'm talking about, I'll teach you. So we've got four commodity sectors there, right? We got your gold, uranium, copper, energy, and that's where the money is moving. That's just very simple, right? Uh but when commodities do well, and we are in the commodity super cycle, the there is also another boom that's attached to that. And that's typically infrastructure and affairs. The numbers are pretty pretty shocking. So general building contractors, these are non-residential construction, is up 330% as an industry. 330%. So you're gonna made 330% while you were sweating about your palantir or your sofa or your Nvidia or something if you just know where to look. Electronic, electronic components are up 300%. We've been in that for some time. Engineering and construction companies are up 200%. Water, sewer, pipeline companies are up 200%. Semiconductors, yes, also up 170%. Electrical products are up. So these are not meme stocks, they're not your crypto stocks, they're companies that are physically building the next infrastructure of the United States. They've got real companies, they've got real contracts, they've got real earnings. And while the SP does 9%, these guys have done, you know, tremendously more. And you already know every tech company out there is spending billions on data centers. And what do these data centers need? Well, they need chips, they need power systems, cooling, copper, physical stuff, like buildings, electrical infrastructure. They need all of it. And my pick in in all of those industries would be, first of all, chips, yeah, Broadcom, AVGO, huge company, children and a half, market cap. They supply custom AI chips to the biggest, you know, Microsoft's and Amazons and so on on the planet, and money is flowing into it. But it's not just the chips, it's also the physical stuff around the chips. And one stock you've probably never heard of is called Fix FIX. It's called Comfort Systems. They're an engineering company, and they basically do the mechanical and electrical systems, which is what data settlers need. Now they're up 500% from its lows. And you may be thinking, oh, it's too late, Felix. Why mention it now? Well, join me on Saturday and I'll show you why too late is usually the wrong way of looking at it. And you know, you could buy the index and buy and hold, but fix won't be in it because people wouldn't have heard about it. Um, another stock I think really worth hooking out. We talked about this before, is Seagate, ticker symbol STX data storage. Um it's a$90 billion company, not really a household name, but it's a massive winner in this in this sector. Uh, another one is uh worth mentioning is Celestica, ticker symbol CLS. They do basically electronic manufacturing stuff. So they make the hardware that powers the cloud and the AI infrastructure massively up, 700%. So real companies, real profits, real earnings. And if you hold an index fund forever, you won't be in these, right? What about defense? Well, Europe's re-arming. The Germans are rearming, which always makes me feel warm and fuzzy inside, especially as I'm one of them. Don't make the Germans re-arm, seriously. We're not, we're not, we're not equipped for it. It's never worked out well, has it? Um, so NATO spending commitments are basically going to the moon, and there are wars going on, and defense companies have these massive, massive backlogs, and the spending is about to get a lot, a lot more. So where would I Rocket Lab? RKLP. It's up 2,079% from this phase, 2700%. Yeah, it's a 40 billion company. They do space launch and defense technology. And again, you might think, oh, I wish I would have found that earlier. True. But it's a bit like planting a tree. The best time is today if you can't find a time machine. A little bit more conservative would be RTX. Uh, used to be called Raytheon. Massive company. Defense blue chip company, basically, only up about 69%. And I say only because yeah, a lot of stocks that we are in or have been in are up a lot more than that. Um, I think they're on the right side of the money rotation. And then you have the whole play around America bringing manufacturing home, right? Semiconductors, battery plants, AV factories, the Chips Act, the ironically named Inflation Reduction Act, which caused more inflation. Um, they're funded programs. So this construction boom is going to go on for decades. And that's why, you know, we've been talking about water pipelines, sewer pipelines, construction in those spaces, because it's been up a lot. Um, one stock here to look at, maybe write these down, is Mazatech. Take a symbol MTZ. They specialize in infrastructure construction, power lines, pipelines, that kind of stuff. Uh, another one is Quanta services. We talked about that one before as well. Engineering construction company, electric power, oil, gas. So these are the companies that are invisible to most retail investors, right? They don't go viral, they don't make the headlines, but they're the backbone of every mega trend and they're up a lot. Um, I think they could go up a lot more. I haven't got a crystal ball, so I has no promise of future performance, but you know, start with where the money is going. And that brings us to the part that should make index fund investors very uncomfortable. Because we also have losers, right? And I run through these very quickly, but remember there are 64 industries right now, almost half, that are losing, more than are going up. And again, these are not obscure ones, these are the industries with household names that are in your index fund. So if you own the SP, um, even diversified ETFs and so on, you are actively destroying your returns by owning these. Um, stream manufacturing is down 37%, Nike being the uh the horror show there, down 54%. So for just professional services, it's down 30%. Consultants. It's not a surprise. Consultants were always a complete waste of life, but it is now becoming obvious that uh Claude can do the same as 200 consultants. And therefore, you know, as much as we've always loathed them, we definitely don't need them right now. So companies like Boose Hallen, uh Booz Allen are down 50%, publishing is down 43%, uh Reuters, right, is one of the world's largest information news companies down almost 50%. Forest products are down 36%. Maybe you think you don't own them. Well, you do, they're in your index. Advertising is down 29%. WPP, world's largest advertising company, is down uh two-thirds. Two-thirds of the money that you have in that got destroyed, but you're holding it. So if you think about this in real dollars, because percentages can feel really abstract, if you put a thousand say you put$10,000 into an index fund two years ago. Today you've got what,$13,000? 30% gain, sounds good, right? But if you put that same$10,000 into just the climbing industries, the ones you've been talking about, you'd be sitting at like$40,000,$50,000, maybe$60,000. And if you'd concentrated in the losers, well, your$10,000 is now worth five, four, three thousand dollars, right? So your broker tells you, or your index fund tells you we're up nine percent. But it's a mix of rocket ships and sinking ships. And maybe you want to get rid of some of the sinking ships. Because the difference between having three thousand dollars and sixty thousand dollars is pretty freaking picky to quote your commander-in-chief, right? That's buy and hold. So let me just make sure you heard what I said, right?$10,000 can become 60, but we can become 3,000. And the difference, in my opinion, it isn't luck, it isn't timing, it's it's knowing where the money is flowing. Not predicting it, but just watching, right? And the textbook buy and hold forever strategy, the one that, you know, everybody tells you to, your parents believe it actually worked for them. That strategy puts you in both outcomes. And then they call it diversification. And look, I'm not a financial advisor, right? I just share with you my opinions, my research. You're gonna make your own decisions. But I tell you this Wall Street does not buy and hold. They never have, not Waltz. It's the playbook they sell to retail at least, to everyday people. So institutions can trade around you, they collect the recurring revenue from your index funds, and it keeps you sitting still while the big money moves around you and makes money. And it's not your fault that you're doing that, because you're never told any different. Nobody told us any different. I had to learn this on the trading floor myself. Like I would not know this, I would not be here today if I had not known this. So, what do they actually do? Well, that's exactly what I'm gonna walk you through step by step this Saturday. It'll be a free live session, we'll go for about two hours. I called why Bion Hold is dead in 2026. And if you doubt this, and you might well do, put doubt in the chat down below. But just think about the speed of technological innovation, the speed of AI and chips and flying things and electric cars and all that stuff, it's faster and faster and faster. So picking you know one great stock and holding it forever. Up like our parents or grandparents maybe did successfully, it's very unlikely they will still be the winners down the road because technology is just making it easier to disrupt these guys. Um so you can register, go to buyandgrow.net, it's completely free, get yourself a free seat, be on time, there'll be no replays, and I think you deserve to know the rules. I think you deserve to know the rules everyone else is playing by. And as I say, it's the first time you're gonna run this, probably the last time you're gonna run it, but it's pretty freaking important. Uh and it means you never ever need to sit through another lost year, another lost decade, watching your money go up and down, and then essentially sideways while other people's portfolios triple, right? So buyinggrow.net, links down below in the description, grab yourself a seat. I'll see you Saturday. And and honestly, the the gap I'm seeing between the winners, the winning stocks, and the losers is the widest it's it's ever been. And the Intex Fund will put you in both, right? So join us on Saturday for the live session, it'll be fun. And um, I'm gonna go and you know to shovel myself and enjoy Infok uh film festival and lots of glamorous people and uh ad me. Uh so I hope this has been useful for you if it has and useful in the comments. Let me know if you're joining us on Saturday. Right Saturday in the comments, and um let's fix this. Let's fix this skill gap for you and uh.