[OP Ed. Note: This Editorial Was Drafted Without AI]

Hey Traders,

My 16-year-old has been hounding me for the last couple of weeks to let him try boxing or MMA. My wife and I have both told him no, separately and together. It ain’t gonna happen.

Sometimes, instead of begging, he gets a little more subtle. He’ll ask me about my favorite fights, or whether I’m into this MMA fighter or that one.

Today, he asked me for my favorite boxing match ever. I actually had an answer for that one, and it’s a bit unusual. It isn’t Ali vs. Foreman or Tyson vs. Holyfield (the one where he bit his ear).

It’s a fight from 1994: George Foreman vs. Michael Moorer.

It featured a 45-year-old, over-the-hill former great (George Foreman) against the reigning heavyweight champ, Michael Moorer. Moorer controlled the first nine rounds in boring fashion. Foreman was too old and too slow, and Moorer was too fast and kept away from George’s one weapon, his right hand.

Then in round 10, ahead on the cards, Moorer decided to challenge Foreman and go more or less punch for punch. Foreman caught him with a couple of shots, and that slowed the champ down. Then came a quick left jab and BAM, a right hand across the jaw.

Moorer’s body collapsed like a lawn blow-up when you turn off the air. Knockout! George Foreman, two months shy of 46, beat a 26-year-old in a boxing ring with two punches.

Right now, the stock market might feel like the first nine rounds of that fight. The amazing young champion (AI and chips) is outclassing the old, boring names in industrials, energy and utilities.

But don’t sleep on those names. Yes, they’ve underperformed tech badly. Heck, if you bought them in the last couple of years, you might be down.

With rates higher, dividends don’t pay like they used to. Being reasonable has never been so bad, and going all in on narrow, speculative bets on the future has never been so great.

Now, I’m not saying AI isn’t the future. It is. But think about AOL, which ended up getting bought by Verizon, a phone company.

Yes, there’ll be Amazons and Googles. But we don’t know who they are yet, and the rest will get swallowed up by boring stocks.

Rates will also come down eventually, and that’ll make a lot of these names far more attractive. So what does a rational trader or investor do while waiting for some of these AI companies’ chickens to come home to roost?

Income. Dividends already pay you on a lot of smart investments, and you can ramp up that income with options. Sell puts to get into stocks you want to own, sell calls against the shares once you take delivery, and collect the dividend while you hold the stock.

If you’d rather not sell naked puts, you can sell put credit spreads (sell a put and buy a cheaper one below it) to cap your downside. If these stocks aren’t going to go up, make them pay you while you wait.

My point is, George (RIP) lost nearly the whole fight and still found his right hand. These stocks will too, and they’ll rally faster than you think. In the meantime, don’t look at your holdings and sigh. Use them to build a second income stream.

Your only option,

Mark Sebastian