Here, we cover a trio of weird, but wonderful “upside-down” investment ideas. Often, all you need to be an excellent investor is a healthy dose of common sense: A penny saved is a penny earned. Buy low, sell high. Don’t put all your eggs in one basket.
That said, the best way to achieve these simple goals isn’t always as obvious. In fact, many of our favorite investment insights may at first seem counterintuitive.
Let Evidence Lead the Way
So, what exactly is evidence-based investing, and why should you care? In short, it’s about setting aside gut feelings and market hunches, and instead, building your investment strategy on decades of academic research and real-world data. Think of it as choosing a GPS based on the most reliable maps available, rather than taking directions from a guy at the gas station.
By anchoring your decisions in sound evidence, you avoid the pitfalls of emotional, knee-jerk reactions when the markets throw a tantrum. Instead, you position yourself to benefit from the broad, long-term growth the markets have historically delivered—without constantly second-guessing every twist and turn along the way.
At its core, evidence-based investing lets you:
Construct portfolios designed to capture market returns over time
Reduce the risks of relying on trends or “can’t-miss” tips
Spend less time worrying about daily market noise, and more time enjoying the people and passions that make life rich
Bottom line? By trusting a well-established approach, you help stack the odds in your favor—not just for your portfolio, but for your peace of mind.
Upside-down Investment Ideas
Investment Insight #1: Market volatility is the norm, not the exception.
How often have you thought something like this: “The markets seem so crazy right now. Maybe I should back away, or at least wait until things settle down before I make my next move.”
The problem is, the markets rarely “settle down.” And when they do, we only realize it in hindsight. There are just too many daily seeds of doubt, forever being sown by late-breaking news. We never know which ones might germinate – until they do, or don’t.
We suggest putting market volatility in proper context with this upside-down investment thought from William Bernstein:
“Being surprised at equities’ ups and downs is like visiting Chicago in January and being shocked by 8 inches of snowfall.”
In other words, it’s normal for markets to swing seasonally. It’s just part of the weather. For example, in Dimensional Fund Advisors’ commentary, “Recent Market Volatility,” we see U.S. stock markets ultimately delivered positive annual returns in 33 of the 40 years between 1979–2018. But during the same period, investors had to tolerate average intra-year declines of 14%.
Investment Insight #2: Market volatility is your frenemy.
What if markets weren’t volatile? What if all the days, in every market, were like November 12, 2019, when the Dow closed at the same 27,691.49 price as the day before?
If prices never changed, traders would become unwilling to trade; they’d have no incentive to do so. In this extreme, markets would no longer be able to serve as a place where buyers and sellers came together and agreed to price changes. Soon enough, markets would cease to exist.
What if there were just far less market volatility? You would probably soon discover how much you missed those same, downward price swings you ordinarily loathe. That’s because, long-standing evidence has informed us: By giving up extra volatility, you also must give up the extra returns you can expect to earn by tolerating the volatility risk to begin with. Here’s upside-down investment idea in this quote from David Booth:
“If you’re living in fear of the next downturn, consider shifting your thinking instead of your investments. Focus on controlling what you can control, such as how much you save, or finding the right stock/bond mix.”
Investment Insight #3: You can win for losing.
Wouldn’t it be great to hold only top selections in your investment portfolio, with no disappointments to detract from your success?
Of course it would. It would also be nice to hold a $100 million winning lottery ticket. But just as the lottery is no place to invest your life’s savings, neither is speculating on the razor-thin odds that you can consistently handpick which stars are next in line to shine.
Instead, we suggest building a broadly diversified portfolio covering a range of asset classes … and sticking with it over time.
By always being already invested wherever the next big run is about to occur, you’re best positioned to earn market returns according to your risk tolerance. At the same time, spreading yourself across multiple asset classes also means you’ll always be invested somewhere that isn’t doing quite as well. This means you’re unlikely to ever “beat the market” in a big, splashy way.
Committing to a Mixed-bag Portfolio
The Freedom of a Systematic Approach
When you embrace a systematic, evidence-based investment approach, you put the heavy lifting where it belongs—on long-term strategies backed by data, not on your daily emotions. Rather than scrambling to outguess the markets or trying to time their next big move, you let a carefully built plan do its work. The result? Less time nervously checking financial headlines and more time enjoying the things—and people—you care about most.
A rules-based strategy helps remove the temptation to tinker. Instead of second-guessing every market dip or swing, you anchor your choices in proven financial principles (think of the research that inspires strategies at places like Vanguard or Dimensional Fund Advisors). This can lighten your mental load and reduce stress, as you’re no longer riding the emotional roller coaster of “should I stay or should I go?” You gain freedom—not just from worry, but from the endless cycle of trying to outwit an unpredictable market.
And that’s the beauty of it: by relying on a sound, systematic plan, you reclaim time and peace of mind—two assets that rarely get mentioned in account statements, but might just be your portfolio’s greatest returns.
Here’s a helpful way to think about committing to a mixed-bag (diversified) portfolio, as stated in this quote from Carl Richards:
“On a scale of 1-10, with 10 being abject misery, I’m willing to bet your unhappiness with a diversified portfolio comes in at about a 5, maybe a 6. But your unhappiness if you guess wrong on your one and only investment for the year? That goes to 11.”
Moving Past Self-Imposed Investment Hurdles
So, what can you do if you find yourself tripping over your own doubts, or wrestling to stick with the life-affirming principles of evidence-based investing? You’re not alone—navigating these challenges is a common part of the journey for most investors.
The good news: You don’t have to go it alone. Consider turning to an experienced, fiduciary advisor who leans on evidence—like those you’ll find at Vanguard, Charles Schwab, or firms aligned with the National Association of Personal Financial Advisors (NAPFA). These professionals can provide the objective perspective and steady hand needed to keep your investment plan on track, even when emotions start to cloud your judgment.
Here’s how they can help:
Review your current plan and suggest adjustments to remove unnecessary obstacles.
Offer reassurance and guidance during tough market stretches, helping you avoid costly, knee-jerk decisions.
Tailor a diversified investment strategy that aligns with your unique goals and risk tolerance.
Keep you focused on what you can control—like savings, allocation, and maintaining perspective—rather than chasing market noise.
Sometimes, simply talking things through with someone who understands both the data and the human side of investing can make all the difference. Whether you’re building your strategy from scratch or refining an existing approach, don’t underestimate the value of objective, empathetic support. It may be just what you need to stay committed for the long haul.
Why a Personalized Plan (and a Guide) Matter
At this point, you might wonder: Why not just go it alone? Why bother with a tailored financial plan or seek professional support at all?
Just as it’s tricky to predict the weather in Chicago or single out which lottery ticket will strike gold, managing your investments amid market ups and downs can be a lonely, confusing pursuit. Even with the best intentions, it’s easy to trip over emotional roadblocks or second-guess your decisions when headlines or market chatter grow loud.
This is where having a financial plan designed around your specific needs—your goals, risk comfort, timeline, and even your quirks—becomes invaluable. A well-crafted plan gives you a clear framework to lean on, no matter what storms roll through the markets. It helps take some of the guesswork and anxiety out of the process, so you can focus less on chasing yesterday’s news and more on your long-term picture.
Even better, working with an experienced advisor can act as your anchor. Think of it as having a patient guide who’s walked this path before—there to help you filter out noise, see your blind spots, and stick to your strategy when your resolve wavers. Vanguard, for instance, found that working with an advisor can add significant value by keeping you on track and helping you avoid common mistakes most investors make on their own.
So, whether you’re just getting started or refining an existing approach, a thoughtful plan and steady guidance can make the journey far less daunting—and more likely to get you where you truly want to go.
Obvious in Hindsight?
We hope the insights we’ve shared now seem a little more obvious. We also hope you’ll be in touch if we can help you incorporate or sustain these three upside-down investment ideas within your own portfolio management. Because as Cliff Asness says:
“‘Obvious’ is often a long way from ‘really believed and internalized’ and in the gap between those two fortunes are made and lost.”