☕️ Meta: Double your profit potential by learning to think in two directions at once

Howdy! 👋 

A few of you reached out recently… some gently and some not so gently, to tell me I "missed" Meta. 

Excellent! 

I'm not upset with you for asking – I actually love that you're paying attention closely enough to notice because that tells me you care about your money. That’s key if you want to be a successful investor. 

So let's slow down and walk through this together, because I think what's underneath is a powerful teaching point, and one that matters a lot more than whether one stock has bounced higher or lower.  

What I am going to share now goes way beyond Meta and, in fact, can be applied to any stock you own. Should be, in fact. 

Here’s why. 😀 

I've spent 45 years in global markets and if there’s one thing I know for certain, it’s that the moment a stock moves, our brains want a simple story. Was the call right or was it wrong. Up or down. Win or lose.  

You get the idea.  

The challenge is that money doesn't actually work that way and neither does investing. It's rarely that clean, and I don't want you to feel foolish for wanting it to be. 

Being right and being profitable are two different things. That's not a criticism – most of Wall Street doesn't fully understand that distinction either, and they do this for a living. 

That’s why today, instead of my usual 5 with Fitz, I want to take a little more time with this one, because I think it can change how you feel about your own investing from this day forward. I also think it could go a long way towards making you successful in today’s complicated financial markets. 

That matters more to me than looking clever this week.  

Or next. 

1 – Let's Start with What Actually Happened 

When Meta was trading north of $700 – some $725+ if memory serves – I told investors that I believed it was headed into the mid-to-upper $400s. That happened about 2 months later. In fact, the dang thing fell to $484 – about as close to a bullseye as this business allows. 

Then I told you it could fall by half again IF the legal cases in New Mexico and California went against the Team Zuck. Not long after, Meta settled – agreeing to pay up to $18 billion to preserve its privacy even though the company claims transparency is paramount. 

Meta has since bounced back about 28%. 

I understand why that bounce is the part that stuck with some of you. It's recent, it's simple, and it's easy to point to. However, the $700+-to-$484 decline that came before it is a lot less flashy, so it's easy to forget… which is apparently what a few folks have done.  

Again, I promise you that's not a character flaw, and you shouldn’t feel foolish; it’s just how memory works for all of us. 

My goal, as always, is that you have the whole picture because you can't feel confident about a decision – mine or your own – without seeing the bigger view. 

Keith's Money Truth: I constantly encourage you to ask questions about anything I say, my research, specific observations and so on. Knowledge is key to investing success. I repeatedly also encourage you to seek the whole story before you decide how you feel about it. Both of those are signs of a healthy relationship with your money and with me. 

2 – You've Trusted Me Through Ups and Downs Before, and It's Worked Out 

I want to gently remind you of two other times this exact conversation happened, because I think it'll help you feel more at ease, not less. 

Years ago, plenty of people questioned me on Palantir (PLTR). It went public through a direct listing in September 2020 at a reference price of $7.25. Along the way, it lost more than 80% of its value at one point, and a lot of people were scared, thought I was wrong and said so, loudly.  

Today, it trades around $183 – something on the order of a 25-fold return, or roughly +2,425% since it went public.  

People questioned me on Tesla (TSLA), too. It priced its 2010 IPO at $17 a share, which works out to a little over a dollar once you account for the stock splits since. It went through half a dozen separate declines of 30% or worse along the way – genuinely scary stretches where plenty of smart, well-meaning people believed the company was finished and told me in no uncertain terms as much.  

Today, it trades north of $375, a return on the order of 331-fold, or roughly +33,015%, since it went public. 

I share this not to say, "I told you so." – I could easily have been wrong. 

I’m reminding you because it’s normal to feel FOMO when a stock runs and you’re not on board. Or when you’ve sold something and it’s taken off. Bought something, seen it drop. 

This kind of conundrum comes with the territory if you invest long enough. I've been told I was wrong on dozens of stocks over the years sometimes within the same week – too optimistic when they fell, too cautious when they climbed. Sometimes in minutes if the markets are really moving – the X crowd is funny that way. 

Yet every single one of those situations has eventually worked itself out – and in a testament to the fabulous folks who have been reading along with me for decades, many of you have followed up to say you were hasty or even “wrong” in judging me. 

I've made peace with it because that kind of noise will always be there – and I encourage you to make peace with it for the same reason. If you can’t, then – well – I suggest very respectfully that you take a hard look in the mirror and ask yourself what it is you hope to accomplish in the markets. 

What matters is that you have a plan you can actually stick with. 

Keith's Investing Tip: A single headline is never the whole story; most of the time it’s not even a fraction of it. Give yourself permission to look at the whole picture before you decide how to feel about a stock, a call, or yourself as an investor. The issue is not being right or being wrong, but again, about being profitable. 

3 – Change Your Perspective, Boost Your Profit Potential 

Here's something I want you to really hear, because I think it can change the way you invest for the rest of your life. 

There's an entire industry built around sounding right. Pundits, headlines, top 10 lists, hot takes – all of it rewards confidence and speed, not necessarily wisdom. I understand why that's appealing because it feels good to be told a clean, simple answer. 

Flip that around. 

Our job as investors isn't to be right and never has been. 

It's to be profitable. 

It’s also to build something that holds up over years, not something that wins an argument this afternoon. Or in the next 60 seconds. Sometimes you’ve got to have two views for one outcome or even make two bets at once, again, for one outcome.  

If you are only thinking in one direction, you are missing half the profit potential. Stocks go up AND down, so it makes sense to think about how you make money in both directions with a single stock, your favorite ETF or even your portfolio as whole. 

Here's a truth that might sting a little. 

Wall Street doesn't actually care whether Meta goes up or down, so it’s important not to delude yourself into thinking that it does. The “Street” makes money either way – on the trading, the commissions, the options activity – regardless of direction. The only outcome that doesn't serve Wall Street is a stock nobody's talking about anymore.  

I want you to know that, not so you become cynical, but so you understand that some of the loudest voices you hear at any moment have a financial interest in keeping you emotionally reactive because their wallet depends on that. 

Keep your emotions out of the equation at all costs – especially in a situation like this one. I also want you to make a deliberate effort to resist the temptation to pile on when the keyboard warriors cut loose, or the FUD squad starts forcing you to second guess yourself. Odds are, the only one who will get hurt is going to be you and your money. 

The world’s most successful investors – including those I respect most and the ones who've actually built lasting wealth over time – measure whether a decision made sense with everything they knew, and whether it moved them closer to true wealth.  

That's a much kinder, much more sustainable way to keep score, and I want that for you because it’s made a world of difference for me. 

Keith's Investing Tip: You don't have to win every argument about a stock to be a successful investor. The world’s greatest investors are often “wrong” at moments in time yet are still profitable over time. What you’ve got to do is keep making sound decisions, over and over even if it means thinking in two directions at once over two different time frames… the short term and the long term. 

4 – I Need You to Know the Whole Picture, Because I Care About Your Money and Hope You Do Too 

Now, here's the part I take seriously. 

People are assuming that everything is “fine” because Meta dodged the reaper in California. 

It isn't, at least not entirely. 

Businesses like Meta operate globally which means that there is a world of “input” to consider. Not just what happened in a US court system in US markets. 

Meta is NOT in the clear. 

A recent case in Germany found Meta liable for impersonation and funnel fraud – a ruling that could open the door to similar cases across the EU and adds pressure to the legal protections Meta relies on here at home. Section 230 of the Communications Act, in particular, which Meta has hidden behind for years. 

New Mexico and California are not the end of the story; they're the beginning of one. If you think for a minute that other legal authorities around the world weren’t watching, you are mistaken. 

Behind them sit class-action suits here in the US over impersonation, deceptive advertising, misuse of trademarks and financial funnel fraud, contracts, terms-of-service disputes, and predatory business/design practices – built to keep people, including kids, engaged whether or not it's good for ‘em. 

According to its own internal documents, Meta may make as much as $16 billion a year from fraudulent, deceptive and criminal activity. So Team Zuck has a very real incentive to protect the status quo. 

Meta is a popular, widely held stock – I get it. 

I'm telling you any of this not to frighten you, but because you deserve to make decisions with your eyes open, not closed.  

Every single one of these issues on its own might fade from the headlines in a week but taken together they paint a picture of a company whose growth has depended on behavior that regulators and courts around the world are becoming less willing to accept. 

That’s the a-ha here. 

A single adverse ruling could open the door to a cascade of negative rulings… rulings that are so expensive they could exceed the value of the company’s entire market capitalization… or which adverse rulings could force changes in the business model that cripple it. 

I know it's uncomfortable to consider this kind of stuff but avoiding what I am saying doesn't make it less true. Just more surprising later. 

I’ve been there over the years and I’d just as soon help you avoid that. 

Keith's Investing Tip: Real financial security doesn't come from avoiding uncomfortable information. It comes from facing it head on, with a plan already in place. 

5 – What’s Next for Meta 

I continue to believe Meta will likely work its way toward $1,000 over the next few years, because Wall Street wants to bid it higher and has every incentive to defend the stock by virtue of the fact that they’ll make billions trading the investing public’s FUD – fear, uncertainty and doubt. 

I also believe it's possible the stock falls toward $400 again before that happens, perhaps even lower if there’s a cascade of adverse legal rulings which, at this point, looks increasingly likely.  

BOTH things can be true, which is why I want you to get comfortable holding two ideas at once instead of needing one clean answer or direction to feel settled. 

The rise of options, leverage and – soon – tokenized stocks will see to it that volatility increases over time which means that you should also prepare mentally for massive moves that have nothing to do whatsoever with what’s happening to Meta or any other headline driven stock whatsoever. 

There are thousands of ways to handle this. 

You can continue to invest in Meta if it meets your risk tolerance, objectives and circumstances (which I don’t know). You can sell a little and buy more when it’s lower or sell a lot and skip the dang stock entirely if you agree with my take. You can also trade around core positions using options and high probability strategies like LowBall Orders, Selling Cash Secured Puts, Covered Calls, the FreeTrade and so on. 

That’s the beauty of a stock like Meta. 

I find that people who grouse about a stock going up or down aren’t really complaining that it’s going up or down but frustrated deeper down that they don’t have a plan or the skills to deal with the situation. But that, my friends, is totally fixable. 

For me? 

Meta doesn't sit right ethically, and after the settlement, my answer is a clear “no, I am not going to own it” for two reasons. We may agree, we may not – that’s moot. 

First, I think the AGs had Meta over a barrel and missed a golden opportunity to reform social media in general, not just Meta. Meta dodged a bullet because the last thing they wanted was to see key executives, programmers and social scientists deposed or on the stand under oath. 

So it’ll be business as usual. 

Second, I don't want to own Meta right now – and I don't need to – because there are other businesses I believe in more, without this much baggage attached and none of the drama. 

The only question that actually matters is whether you, personally, are financially and emotionally prepared for a real worst-case scenario in anything you own – Meta or otherwise. If you are, and a hard landing wouldn't derail you, that is a legitimate, adult choice, and I respect you for making it even if we don’t agree. 

For my own part, I plan to keep LowBall Orders in place in the event Meta corrects again/further. I'm also holding onto some speculative puts in case it declines again over the next year and plan to use those as part of an ongoing options strategy.  

If you’re a member of the One Bar Ahead® Family, you know. 

I have no need to be proven right or wrong because I have tremendous peace of mind either way… my goal is to see you arrive in that same space. 

Keith's Investing Tip: A good plan doesn't require you to predict the future correctly. It just needs to let you survive being early or wrong about timing or a dozen other variables that we haven’t talked about today, so you're still standing when you turn out to be right about the bigger picture as I believe will be the case here (again). 

Bottom Line 

At the end of the day and when you’re finished reading along, I want you to walk away feeling calmer than when you started, not more anxious, and definitely not scolded. 

If you own Meta, great. If you don’t, also great. 

Real investing was never meant to be a scoreboard that resets every afternoon nor even in a matter of weeks. It does you no good whatsoever to judge something you bought with a ten-year horizon in 10 minutes, 10 days or even 10 months. 

Investing and building wealth come together as a long, patient practice of making sound decisions, staying grounded when everyone else gets distracted and giving yourself permission to be comfortable with uncertainty without needing to resolve it immediately. 

Meta will do what Meta does.  

The same is true about the people yelling the loudest about Meta – or any other stock for that matter. They’ll move on to something else soon enough. Or they’ll undoubtedly find something new to chide me about without bothering to take a look in the mirror, see the bigger picture or accept accountability for their own actions. 

Meanwhile, I will keep doing exactly what I've always done for you for decades… telling you the whole truth, as plainly and as kindly as I know how, especially when it's inconvenient. 

You got this — I promise. 

Now and as always, let's MAKE it a great day. 

Keith 😀