3 Bad Investing Mistakes I Won't Repeat in 2026 and Beyond

The author recounts three 2025 investment mistakes: succumbing to FOMO by making a large unplanned Bitcoin purchase as BTC rallied past $120,000, procrastinating on Zcash research only after it more than doubled in a week and briefly overtook Monero by market cap, and freezing purchases (SPY and Costco) during a tariff-driven panic that wiped roughly $5 trillion from markets before a 90-day tariff pause was announced on April 9, 2025. The piece underscores the value of disciplined dollar-cost averaging, explicit rules for accelerating buys, and treating volatile policy-driven episodes as opportunities to maintain consistent allocation decisions.

Analysis

Market structure is bifurcating: risk assets (SPY, growth names) are sensitive to headline trade-policy shocks while niche crypto assets (BTC, ZEC) are driven by attention flows and liquidity. Direct winners from tariff uncertainty are domestically focused retailers with scale to absorb supply shocks (Costco/COST) and cash-rich manufacturers that can onshore; losers are smaller import-dependent retailers and leveraged growth names that reprice on higher trade costs. Cross-asset flows are predictable: tariff risk -> bid for duration and USD safe-haven, compressed commodity demand (industrial metals/oil) and spiked vol in equity options markets.

Tail risks cluster around policy/regulatory shocks. Near-term (days) the biggest tail is tariff re-escalation producing a >10% equity drawdown (recall ~$5T wiped in two days in April 2025); short-term (weeks–months) regulatory clampdowns on privacy coins or crypto exchanges could halve price discovery in ZEC/BTC; long-term (quarters–years) structural shifts (reshoring, lasting tariff regimes) could compress margins for global retail supply chains by 200–400bps. Hidden dependencies: leveraged crypto derivatives, ETF cash flows and retail FOMO can amplify moves; margin fundinglines can flip from liquidity source to accelerator.

Trade implications: establish disciplined, size-constrained positions and hedge tails. Use DCA for BTC (1.5–3% portfolio over 6 months) with option collars to cap downside; accumulate COST on calibrated pullbacks (tranche buys every 5% drop to a 20% max drawdown target) and sell 3-month 5–10% OTM covered calls to monetize carry. For portfolio protection, buy SPY 3-month 5% OTM puts sized to cover 2–3% portfolio tail risk or sell cash-secured put spreads to acquire exposure at lower prices.

Contrarian view: the market has over-penalized consistent, scale players (Costco, large-cap ETFs) during headline scares while over-rewarding narrative-driven crypto rallies; that creates tactical mispricings lasting 1–3 months. Historical parallels: 2018 trade-spike volatility produced 3–6 month P/E compression then normalization—expect similar mean-reversion unless policy permanence is signaled. Watch: tariff announcements, ETF flow reversals, VIX >25, BTC on-chain flows and ZEC active addresses over next 30–90 days as catalysts that confirm or reverse current dispersion.

Key Decisions for Investors

• Initiate a disciplined BTC allocation: establish 1.5% of portfolio in Bitcoin via DCA over 6 months (equal weekly or biweekly tranches). If price falls >25% from current levels, step up to 3% total; buy 3-month 10% OTM BTC puts sized to cover 25% of position as a tail hedge.
• Accumulate COST on weakness: start with 1% portfolio weight today and add tranches every 5% drawdown up to a 20% total drawdown (target full allocation 2–4%). Sell 3-month covered calls 5–10% OTM on each tranche to generate ~2–4% annualized carry while you average in.
• Protect core equity exposure (SPY): retain strategic SPY weight but buy SPY 3-month 5% OTM puts sized to protect 2–3% of portfolio against headline tariff-driven drawdowns. Alternatively, sell cash-secured put spreads (3-month, 5%–10% OTM) to acquire SPY at cheaper levels with defined risk.
• Speculative privacy-coin tactic: allocate no more than 0.5–1% portfolio to ZEC via DCA over 3 months. Construct pair hedge: if ZEC outperforms Monero (XMR) by >30% within 30 days, trim ZEC and establish short ZEC/long XMR pair (equal notional) to capture mean reversion; reassess if regulatory guidance is issued within 60 days.