| Less easy to make was my prediction three years ago that Netflix (NSDQ: NFLX) had become overvalued. Wall Street loved Netflix and felt it could do no wrong, but my IDEAL system said otherwise. A few weeks later, the company released quarterly results that came up short of expectations. Within a matter of days, NFLX dropped 15%. Timing is Everything You could have made a lot of money by selling Tesla and Netflix short at the right time. Of course, you also could have lost a lot of money if you did it at the wrong time. That's why you need to have a timing element as part of your trading process. Some stocks can stay overvalued for a long time until an event triggers a landslide. That's why I have included each company's earnings date in the table above. More often than not, bad news often comes in the form of an unexpectedly weak quarter that catches Wall Street by surprise. And since the second quarter just ended, all but one of these companies will be releasing their next set of results within the next four weeks. I suspect more than a few of them will disappoint the market this time. For my money, the best way to profit from an overvalued stock is to buy a put option on it that is slightly out-of-the-money. That means the option's strike price is a little below the current price of the stock. A put option increases in value as the price of the underlying stock goes down. Therefore, you want to buy the option on a day that the stock is trading up to minimize the premium that you pay for it. Of course, there is always the risk that the stock may continue to rise in which case your put option may become worthless. That's why I prefer to spread my money over several stocks instead of betting big on just one of them. If that approach is too risky for you, my colleague Jim Fink employs a more conservative system that he has used with phenomenal success. Jim's investment system hands out a regular weekly payment to his followers, sort of like a "paycheck" that they can count on, week in and week out. We've just released Jim's new presentation. It explains how investors just like you can use one simple technique to earn steady income payments of $1,150, and $1,500, and even $2,800… every single week. Want to sign up for your paycheck? Click here now. | 
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