In my last article, I wrote about how you shouldn't allow your emotional side to make trading decisions for you, and that procrastinating (hesitating) about whether to action a trade idea can mean you miss out entirely.
In this article, I am going to appear to contradict myself. But if there is one truth in the financial markets, it's that very few situations are binary (black and white) and that most of them have multiple potential outcomes, or shades of grey.
And so, it is here.
No unicorns
You shouldn't spend your time looking for the perfect trade because, like a unicorn, it doesn't exist (and probably never has). It's quite possible that you are thinking along the right lines, but that there might be a “better vehicle”, through you through which you can action your strategy.
Once again, I can show you what I mean through a real-world example.
The chart below is of the US toy company Mattel MAT US, the company behind the Barbie, Fisher-Price, Hot Wheels, and Matchbox brands, to name a few.
The stock first came to my attention on 13 July, as it added +3.82%, having been written up at Swiss bank UBS, whose analysts gave it a buy recommendation and $28.0 price target.
The bank wrote:
“Mattel Inc (MAT, Buy, $28) - What's Mattel's Brand Equity Really Worth? (Arpine Kocharyan)
We take a 3-pronged brand equity valuation approach to determine the underlying brand equity value for Mattel, arriving at a range of $22 to $39/share”
The stock rallied by +5.70% on 16 July to trade up to S14.83, and it also took up a prominent position on my Midcap Smile chart, which visualises price action, relative strength and weakness.
And of course, who could ignore the carrot on a stick in the chart that the gap above $18.33 represents.
Source: Barchart.com
Better options
It had all the makings of a decent set-up; however, what I didn't do was to check to see if another stock among Mattel's peers was a better bet, a stronger recovery play.
A schoolboy error, really, on my part because Mattel has a direct competitor in the shape of Hasbro Inc. HAS US, which counts Monopoly, My Little Pony among its brands.
Hasbro reported Q2 earnings on Tuesday, and it beat on EPS and raised its 2026 revenue growth guidance, from +3.0 to +5.0%, to between +5.0% and +7.0%,
The stock rallied by +13.0% on that news; yet there was little read across to Mattel, which was up by just +0.42% on the day.
What I am really talking about here is getting the biggest bang for your buck, something I wrote about back in October 2025, when I said:
“In the first of these articles, we looked at how traders could try to identify the stocks that will outperform their peers under a common narrative, such as data centre and power demand, and the buzz around quantum computing.”
And that:
“The idea being that if you can find the “category killer”, then your trading gains could be greatly enhanced versus the rest of the pack, assuming that you execute and manage the trade effectively.”
The links to those October articles can be found below:
Easier in Hindsight
In hindsight, I wouldn’t have had to look very far to realise that Hasbro was a better prospect.
The table below is a summary of analyst opinion and earnings expectations for the stock.
Hasbro scored a respectable 4.60 out of 5.0 with 12 strong buy and 3 hold recommendations among the 15 analysts that cover the stock. The mean target price for the name is $106.00.
Source: Barchart.com
Mattel, on the other hand, scored only 3.80 out of 5.0 and is rated a moderate buy with 8 strong buys.5 hold and 2 sell recommendations among the 15 analysts that research the stock. Who I think we can safely assume are the same analysts that cover Hasbro.
Source: Barchart.com
The net result of this was the large green candle of the far right of the Hasbro chart below, while Mattel's share price barely moved the dial on Tuesday.
Source: Barchart.com
Mattel could have its own moment in the sun when it reports after the close on 4 August, but even if it does, I think it's fair to say that I missed a trick.
The lesson here is to stick to your (my) process and take the time to examine the viability of a trade in sector or industry peers, before pulling the trigger on a given stock.
Of course, sometimes a setup will be unique to a single stock. However, where there is a common theme or driver, in this case, valuation and proximity to earnings, it makes sense to double-check.
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