Sunday, November 22nd, 2009

How to Make 200+% on the Coming, Inevitable Market Correction!

Jun 29th, 2009 | By Steve McDonald | Category: Stock Market Investing

The market has gone up 41% since March 9th. Lots of investors are wishing they could have pocketed that 30% gain so they are jumping in now, hoping the ride will continue.But for three irrefutable reasons, the three-month-run up virtually guarantees a correction. Those Johnny-Come-Latelys won’t profit in the near future, they’ll get crushed.

But you can make much more than 41% if you follow my advice. In fact, you stand to make 200% — maybe more – by taking advantage of a little-known strategy I’ve been using (and teaching Sound Profit readers) for some time.

Let’s start with an observation: When a market surges like this one did, a correction is a sure bet. There aren’t many givens in the stock business, but this correction is a given.

I can give you a dozen reasons why, but the following 5 should convince you:

1. The S&P broke through the 200 day moving average which is the beginning of the retreat
2. Upside trading volume has dropped by as much as 50% since late April. Always a downward indicator
3. We have had an increase of the ratio of flat to down market days to up days.
4. Oil has doubled in price which in every market has been a downward signal.
5. But the biggest and most significant red flag is that everyone in the market believes we must have a pullback. We have run too far and too fast.

If you act now you can save whatever gains you have made since March and parlay that into a small fortune. But to do so you may have to stretch your emotional envelope a bit and follow a strategy that might violate some “beliefs” you’ve had about investing.

But if I could show you – with certainty – how to make 200%+ on your money by unlearning a “belief,” would you be willing to listen?

Good.

Let’s begin by disposing of that “belief.”

Markets do not have to go up to make money!

The market is down 66% of the time. If you ignore the short side you are missing two thirds of the gains.

Still don’t buy it? Go back and count your stocks that went down in the last two years. That should do it!

The first step to capturing 2/3’s of the gains the market has to offer:

Admit this market has to go down. It will go up through 10,000 and then 15,000, but right now it is going to sell off.

Capture the downside using Inverse ETF’s.

Is it difficult? It’s like buying a stock that has twice the return and two times the probability of working. It’s that easy!

Some Inverse ETF’s return 200% of an industry’s or index’s downside. 200%! Why settle for average when you can get 200%.

Get out of the herd! Stretch the envelope and turn this correction into a huge return.

Take a look at the Sound Profits newsletter. It specializes in making big returns in strategies like this with easy to understand step by step explanations.

Source: How to Make 200+% on the Coming, Inevitable Market Correction!


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By Steve McDonald

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Steve McDonald is a contributor to Investor's Daily Edge.

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Investor's Daily Edge is a free investment e-letter delivered every day before the market opens. In each issue you'll receive clear recommendations and practical strategies for protecting your portfolio and multiplying your money, whether the market is rising or falling.

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