Editor's note: Last month, Porter posed a question you've likely never asked yourself.

"Why am I buying stocks?"

Today's Masters Series is adapted from the February 16 Digest. In it, Porter shares a safer – and more lucrative – alternative to buying stocks...

Make More Money Than With Stocks... and With Far Less Risk

By Porter Stansberry

In today's essay, I'd like for you to turn off all of the news and all of the noise.

I'm serious... Shut down your Twitter or your Facebook. Close your Internet browser. Turn it all off. If you have a printer, then print this out. Go somewhere comfortable and quiet. For just 15 minutes or so, I want you to read and think quietly. Calmly. With zero urgency.

It's incredibly difficult for most people to unplug. But just for a few minutes, ignore the websites that "shout" information at you, manipulating your emotions, giving you a false sense of confidence about your decisions, and pressuring you to take action.

Turn off CNBC.

Those networks try to create the impression that the markets are like a sporting event. That's so you won't turn them off, even for a minute. All of that drama doesn't benefit you or help you make better, more thoughtful decisions. It drives brokerage orders and advertising revenues.

Investing – good investing – isn't ever urgent.

So just relax. Put your feet up. Open your mind to a different rhythm. There's no hurry. It's not a race. You're not going to miss the opportunity.

This isn't dramatic. It isn't urgent. It's safe. It's almost boring.

But this – the investment lessons in the story below – will make you far, far more money than you will ever make buying stocks. It's also vastly safer.

And nobody on CNBC or at your brokerage firm wants you to know anything about it.

Last fall, one of America's best businesses received what looked like a death sentence. Iconix Brand Group (ICON) is a business you've probably never heard of before. It operates behind the scenes, with only a handful of employees.

It doesn't make anything or provide any services. Instead, it owns iconic consumer brands – more than 30 of them around the world. Brands like Joe Boxer, London Fog, Mossimo, Ocean Pacific, Danskin, and Umbro. These brands signal quality and value to consumers in multiple product categories, helping retailers like Target (TGT) and Walmart (WMT) sell products.

Every time one of those products is sold, Iconix receives a royalty, typically 3% of the sale price. At the end of last year, Iconix was collecting royalties on more than $13 billion in retail sales. Doing the math, you'll discover that's roughly $400 million in annual revenue.

If you've followed our work for any period of time, you should know that we greatly prefer and admire businesses like these, which are extraordinarily "capital efficient." Iconix doesn't have to build factories or retail outlets. It doesn't have to hire designers or spend money trying to drive traffic to retail stores. It can just sit back and cash its royalty checks.

It sits in the epicenter of global commerce and gets a free ride on the back of lots of other big, capital investments. As a result, Iconix produces about $0.40 of "free cash flow" – that's its cash profits after all expenses and capital investments – from each dollar of revenue. That's unheard of in any other kind of business.

This is a great business. It is one of the most capital-efficient businesses in the entire world. And... do you think consumers are going to stop buying branded products anytime soon? I don't. By early 2014, Iconix was worth more than $2 billion, and its shares were trading for more than $40.

But even great businesses can stumble... By Halloween last fall, Iconix's stock had fallen 70% in only a few days. The company was suddenly worth less than $100 million. Clearly, Wall Street expected the company to go bankrupt. Even the firm's bonds were selling off, trading for about $0.50 on the dollar.

What went wrong? Just about everything. The company's founder and CEO, Neil Cole, was cooking the books. The truth came out in late 2015, and that led to a U.S. Securities and Exchange Commission investigation in 2016. The firm had to restate its earnings for 2013, 2014, and 2015. But the real trouble was that the fraudulent accounting had covered up several mistakes that the former management made – paying too much to acquire brands.

And then... in the fall of last year... the real hammer fell.

Walmart announced it would no longer sell Danskin, Iconix's 135-year-old fitness brand for women. This came on the heels of an announcement by Target that it would drop Iconix's Mossimo brand.

All of these problems led to a potential "death spiral." The reduction in revenues and the company's declining financial position meant it couldn't comply with various covenants on its outstanding debts. These potential debt-covenant violations drove the company's banks to pull the $300 million of new financing that had been in place to meet a bond repayment that was rescheduled for early 2018.

That's why Wall Street thought the company would go bankrupt.

These troubles were enough to keep virtually any investor away from Iconix's stocks and bonds.

But two things interested us...

First, even with reduced revenues, the company's inherent capital efficiency meant the firm was still capable of producing large amounts ($50 million-plus) in cash flow each year. And second, at the newly "wiped out" share and bond prices, there was, in our view, almost zero risk left in the company's securities.

No, this kind of investing isn't "sexy." It's not bitcoin. The stocks and bonds of Iconix are not going to the moon. But at less than $2 per share, the stock was trading for about 25% of book value. So even though the company still had challenges ahead, there was the potential for a 300% gain if it didn't go bankrupt.

And at around $0.50 on the dollar, the company's bonds would double in less than six months if they were redeemed at par value. The downside in the bonds? Almost none. The average corporate bond that defaults has a recovery of $0.45 on the dollar, and this company's assets were of a much higher quality than average.

For good investors, there was plenty of opportunity here. All you needed was a talented forensic accountant/auditor and an experienced corporate attorney who could read all of the loan documents to make sure you had a thorough understanding of the debt instruments.

Easy, right?

Well, that's where it stops for most investors. They look at this mess and throw up their hands and just say, "It's too hard. There's no way I can figure out what this stuff is really worth." And that's fine. You can go your entire life without buying any distressed corporate debt and still be successful as an investor.

But I have a fundamentally different belief. I think every investor ought to understand bonds and become successful at buying them before you ever buy a stock.

And here's a big secret. If you learn how to buy bonds the right way, you can earn more money in bonds than you will make in stocks. You'll do so with a far higher winning percentage, too.

And that raises the question... if you can make more money in bonds, with less risk, why would you ever buy stocks?

Why indeed.

That's why I urge anyone who hasn't yet reached what they consider a satisfactory level of success as an investor to seriously consider learning how to invest in bonds. Focus on those investments first, rather than stocks.

Regards,

Porter Stansberry

Editor's note: Since launching Stansberry's Credit Opportunities in late 2015, the results have been phenomenal. Of the 15 closed positions, 13 were winners... And the average annualized return is 33%. Again, these returns were possible while taking less risk than buying regular stocks. Porter's team recently released a video presentation explaining everything you need to know about this powerful and lucrative investment. Watch it here.