I love going to my friend John for market advice.

Not because his advice is any good. In fact, it’s the exact opposite of good. It’s consistently bad.

That’s because John is the living embodiment of “the dumb money.”

(For anyone who doesn’t read a lot of stock commentary, “the dumb money” often refers to the general “crowd” of “folks” who are “left holding the bag” after the “smart money” gets out at the top of a market peak. The dumb money is the last man to the party… usually right before the punchbowl gets taken away. In summary, the dumb money sells low and buys high.)

Here’s what has always fascinated me about “the dumb money.” They’re not actually dumb. They just have really bad timing.

For example, do you remember Snap’s (SNAP) ultra-hot IPO at the beginning of 2017? Everyone was buzzing about it, even my friends who didn’t follow the market. After shares jumped from $17 to $24.48 — a 44% gain on their first day of trading — John decided he did not want to miss the boat. So he bought in the next day when shares were about $27, as did everyone else who was swept up in the SNAP hype.