A financially independent trader who's returned 33% in 2025 says right now is a 'massive opportunity for investors'
As an options trader, Erik Smolinski thrives in chaotic markets.
“In the options-trading world, what you need is not necessarily persistent, directional moves like most standard buy-and-hold portfolios might,” he told Business Insider in May 2025. “What you need is volatility, which is what we’ve got in spades.”
Smolinski has been trading since 2007, when he was still in high school. He’s only posted two negative years — his first two years — and has consistently beaten the S&P 500 ever since. Between 2018 and 2022, he returned 24.6% on average, which BI verified by looking at screenshots of his summary statements. The S&P 500 averaged nearly 12% over the same period.
As of April 2025, he had returned 33% for the year and outperformed all but four years in his 18-year trading career. The S&P 500 fell 6% over the same timeframe in 2025.
“This whole market has been such a joy to trade,” he said. “Institutions don’t know what’s going on any better than retail traders because it’s all a crap shoot. You don’t know what’s coming out on the next tweet or Truth Social. It is straight madness, but it is a trader’s dream and a massive opportunity for investors because this kind of dislocation levels the playing field for everybody.”
By one measure, the economy has not been this unpredictable in many decades. The Economic Policy Uncertainty Index, which tracks how frequently newspapers write about the economy, policy, and uncertainty, spiked in April to the highest level since recordkeeping began in 1985.
Still, Smolinski hasn’t made any drastic changes to his strategy in 2025. After all, he attributes his general success trading to having a detailed plan and sticking to it.
“I don’t chase topline performance. I wholly focus on process,” he said. “That means that as I’m executing what I’m doing as a trader, there’s no going off script and saying, ‘Oh, I feel like this is going to happen, so I’m going to react this way.’ I don’t care how I feel. What I care about is what makes sense and sticking to that process.”
That doesn’t mean he never shifts his strategy. He does weekly and monthly AARs — “after action reviews,” a concept he picked up whiles serving in the Marine Corps — and uses that time to ask himself, “what’s working?” and, “what’s not working?”
How the everyday investor can capitalize in 2025
Smolinski recognizes that, as an investor, he’s more active than most. For the everyday investor looking to capitalize on what he believes to be a “massive opportunity,” he first advises setting aside cash. This is separate from your emergency fund, which should be built out before you start investing, and specifically “to be able to gain exposure quickly to opportunities as they begin to hit prices that the investor likes,” he said.
Next, create a “watch list” of potential investments to jump on. If you’re not sure where to start, ask yourself a few broad questions.
For example, “Do you think technology is going to be bigger, more profitable, more dominant five years from now?” he said. “I feel pretty confident on the yes, personally. So, one of the simple things a retail trader could do is start at the very high level and start dollar cost averaging into QQQ, which is the Nasdaq 100 Index ETF. It’s still bundled into an index ETF, it still keeps your money inherently diversified in one low-cost index fund, but it’s a little bit concentrated into tech.”
Another broad category he considers is healthcare.
“Think about what kind of impact something like AI can have in that sort of industry, everything from diagnostics to records-keeping to patient management,” he said, adding that there are index ETFs that track the medical field.
Those types of ETFs may go into your “core bucket” of investments, he said, which should be lower risk and focused on long-term growth. If you have extra money to invest, you can consider adding a “speculative bucket” to your portfolio.
When considering more speculative investments, Smolinski said there are two broad directions you could go in.
One, you could consider policy-driven impacts, and industries and businesses that are likely to benefit under the current administration over the next two to four years.
Two, you could think longer-term, beyond the current administration, about “industry-level revolutions and what companies are positioning themselves well,” he said, giving Palantir as an example. “Palantir started as mostly a government-facing AI contractor, but now they’re spreading massively into the commercial industry.”
Use your intuition by asking yourself: “Do I think this could be bigger in the future, and why? If you can answer why with a decent reason, you’re probably onto something,” he said.
You can also use an AI chatbot like ChatGPT to help you brainstorm by feeding it a prompt such as, “What kind of industries are likely to benefit the most, and what are publicly traded companies within those industries that are most likely to benefit?” he said. “Boom. It gives you all the research. Then, use it for follow-up questions to really help solidify your understanding of things.”
For the passive investor who wants to set and forget their portfolio and is less interested in having a speculative bucket, “it’s very much about consistency,” said Smolinski.
Don’t let recession chatter or market swings cause you to pull out of the market or avoid investing in the first place.
“There’s always something going on. Always. It’s humanity. So, if you use the excuse of, ‘blank is going on,’ guess what? Something is always going on. It means you will do nothing,” he said.
“So much more money is lost by leaving it to sit and decay from inflation, chewing your lunch, and waiting for some sort of drop to put your money in. Simply start and don’t stop.”