The Costliest Mistakes Investors Make at Market Turning Points

1. Trusting indicators with no historical foundation

Berg's most common observation about self-directed investors: they lean on indicators that have almost no historical foundation under them. A tool that draws attractive lines on a chart answers neither of the two questions that matter — how often has this configuration actually occurred, and what happened next, every time, without exception?

His own standard is unforgiving: histogram every indicator, isolate the extreme tails, and act only on readings whose precedents can be enumerated and audited. If a signal's full history fits on an index card, you can trust the card — or at least know exactly how thin the evidence is.

2. Refusing to turn on a dime

Both individual and institutional investors, Berg observes, find it emotionally difficult to reverse course quickly — even though markets routinely demand it. Four times in recent memory the S&P 500 has V-bottomed, turning sharply higher straight off the low with no testing phase: March 9, 2009; December 24, 2018; March 23, 2020; and April 8, 2025. Investors who waited for the comfortable retest missed the turn entirely.

The same rigidity costs money at tops. Gold crashed immediately after spike highs on April 28, 2011 and January 30, 2026 — no distribution phase, no second chance to sell the high.

3. Overthinking the signal

Berg's rule is one short sentence: “When the models say go, do not second-guess.” He offers his own worst miss as the cautionary tale — March 23, 2020, the COVID low, when client fears affected his neutrality and he failed to fully implement the buy signals his own models generated. Historically effective at following the data objectively, he was, that one time, not — and it was the most serious mistake of his independent career.

The implication is worth sitting with: if the author of the models can be talked out of his own signals under stress, so can you. That is an argument for rules, not for better instincts.

4. Reaching for leveraged ETFs

Berg often recommends the use of leverage to institutional clients — but never through leveraged ETFs. By construction, those vehicles must sell as markets fall and buy as they climb, a rebalancing pattern that does its worst damage precisely when markets are most volatile. The vehicle quietly works against the position it claims to amplify.

5. Predicting instead of positioning

Asked how he distinguishes an ordinary correction from the start of a multiyear bear market, Berg's answer is that he doesn't — not in advance. When his work signals a peak, he turns bearish without deciding in advance whether the move will stay a brief pullback or grow into a multiyear decline, and he stays bearish until the models turn up again — whether that happens 6% down or 45% down.

The refusal to predict is not modesty theater; it is the discipline that keeps a wrong opinion from compounding. Positioning follows evidence. Narratives follow price.

The antidote

Asked what advice he would give his 1978 self, Berg's answer had nothing to do with indicators: stay humble without losing confidence in your own work and your edge; build a few deep, lasting relationships that hold through every market cycle; and put integrity and capital preservation ahead of everything else, trusting that opportunities always return.

Every mistake on this list is, at bottom, a failure of one of those three. The fix is not a smarter oscillator. It is a tested process, applied without negotiation — which is exactly what a rules-based model is for.