| This outperformance is not new but the continuation of a long-term trend. From 2002 through 2022, the equal-weight index beat the traditional S&P 500 by about 1.5% a year. Over the past 25 years, the outperformance is slightly less: 1.2%. But that's enough to make the equal-weight indexer one-third richer at the end of the period. Yet, if history is any guide, very few readers made the switch. Why? Because everyone loves a winner. It's difficult for most people to get off the momentum train as long as the strategy is working. Even if it doesn't make sense. Consider bitcoin. I've written numerous columns pointing out that it is a non-productive asset with no tangible value and no present or future cash flows. After 18 years, this "new technology" still makes transactions slower, more difficult, and more expensive. (However, its cryptography does have value if you are a bribe payer, kickback taker, extortionist, tax cheat, human trafficker, heavy weapons dealer, terrorist network, drug cartel or country evading economic sanctions.) It is not digital gold. In fact, you can buy digital gold through any number of publicly traded tokens. Or you can just buy SPDR Gold Shares (NYSE: GLD). Bitcoin is a failure as a currency because it is so volatile. And with a hard cap of seven transactions per second, it can't scale up either. (Although I can't imagine why you'd want to scale up a currency that routinely plunges 40%-50%.) Bitcoin is a speculative asset, period. True, it has limited issuance. There will never be more than 21 million coins. But that makes little difference when there are an unlimited number of other cryptocurrencies that also have limited issuance. I've debated bitcoin bulls at conferences. I've written columns where I explain these facts. No one - including my debate opponents - contests them. Their only retort is "You're just flapping your gums while I'm making serious money over here." But they haven't been saying that lately. Approximately half the circulating Bitcoins are now worth less than the owners paid for them. Worse still, investors are selling for less than they paid, converting paper losses into realized losses. This momentum trade has come to a screeching halt. Bottom line? You can warn investors that The Magnificent Seven is "the most crowded trade on the planet." You can warn indexers that concentration risk makes the S&P 500 vulnerable to serious underperformance. And you can warn bitcoin holders that they own a limited supply of nothing. But you can't expect them to change their behavior as long as the market rewards them for simply hanging in there. It's only after they get slammed into the glass that they realize that hockey great Wayne Gretzky was right. The secret of success is not madly chasing the puck. It's positioning yourself where it's going to be instead. Good investing, Alex P.S. Amazon is currently offering the Kindle version of my new book "The American Dream: Why It's Still Alive... and How to Achieve It" for just $2.99! To learn more - or take advantage of this limited time deal - click here. | 
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