If the recent choppy market has your head spinning, you’re not the only one.
Fact is, the markets are in a state of confusion because we are seeing a number of domestic and global events that traders and investors are still trying to sort out.
I mention that because if there’s one thing Wall Street hates above all others, it is uncertainty.
That was clearly true on Aug. 15, when a headline in The Wall Street Journal said it all: “Stocks Fall as Trade Tensions Persist.” That day the bellwether S&P 500 fell 0.7%, while the tech-centric Nasdaq Composite declined 1.2%.
The immediate cause for concern was President Donald Trump’s decision to double tariffs for steel and aluminum on Turkey. News of those tariffs have sent Turkey’s currency, the lira, into a huge slide as the dollar has rallied.
The situation got even tenser yesterday morning when the Journal reported that the White House rejected a Turkish proposal to free detained American pastor Andrew Brunson in exchange for relief for Halkbank. That major Turkish bank is facing major fines for its alleged violation of U.S. sanctions on Iran.
And the deteriorating situation with Turkey is just the beginning.
There’s also a lot of uncertainty about how Trump’s tariffs on China and other countries might affect global growth. Yesterday, talks in Washington began on the Trump administration’s proposed duties of up to 25% on some $200 billion in Chinese consumer goods entering the United States.
While the trade war rhetoric seems to be cooling – now – that tide could turn as soon as today.
With that in mind, I want to give you three important tools that will help you weather this storm of uncertainty.
These tools will help you hold onto your money during these uncertain times.
In fact, with them, you boost your gains by 50%.
Fundamentals Are Still Sound
One reason we’re seeing all this turbulence has to do with a simple but crucial fact. We’ve been in one of the great bull markets of all time, which began when the market started rebounding from the financial crisis on March 9, 2009.
The S&P has gained nearly 314% since then. That means millions of investors are sitting on billions in profits. In a situation like this, average investors can get anxious when they think they may be giving up some of the greatest gains they’ve ever made.
As for me, I’m not worried. I see an economy on fire. One that’s boosting demand for tech products and services across the board.
For example, the unemployment rate of 3.9% for July was the lowest we’ve seen since the late 1960s. There are now more job openings than there are unemployed people.
We’re also getting the best growth we’ve seen in roughly a decade. The GDP for the second quarter came in at 4.1%, and economists expect a strong report for the third quarter that ends Sept. 30.
In other words, the choppiness that we may see more of in the weeks ahead has little to do with economic or financial fundamentals.
But that doesn’t mean we can simply throw caution to the wind. With that in mind, I want to share the three tools you need for these rocky markets.
Take a look…
Choppy Market Tool No. 1: The Cowboy Split
I’m shocked more professional investors don’t know about this powerful moneymaking tool. But it’s one my paid-up Nova-X Report members have been using to rack up triple-digit gains like clockwork.
Simply stated, the Cowboy Split is a staggered-entry system. You take a position in a stock at market – and then enter a “lowball limit” order to buy more if a discount comes your way.
In general, I recommend employing a 15% to 20% discount from your entry price as a second buy point.
Here’s how it works…
Say you acquire 50% of your intended stake of XYZ Tech Corp. at a price of $50 per share. In this case, should the market trigger your “lowball limit” order, you would automatically buy a second 50% stake at $40 per share, for an average price of $45 per share.
Now assume XYZ rallies all the way to $60. You would then have 16.6% appreciation on your original shares. But it’s that second stake that really juices your profits.
See, that second half’s gains are double those of your first buy. This way, you end up with overall gains of 25%, or roughly 50% more than you would have had if you’d just bought your full stake at $50.
Choppy Market Tool No. 2: Play “Moneyball”
These days, the market is filled with momentum traders. These aggressive traders pile into stocks that are on the move.
While their moves can add to your short-term gains, they also greatly increase the odds that you’ll see a big mover reverse quickly on profit-taking.
That’s why the Choppy Market Tool that I call playing “Moneyball” is so effective. I named it after the book and movie Moneyball, about how my hometown baseball team, the Oakland Athletics, won 20 straight games in 2002 on a shoestring budget using a similar strategy.
The A’s weren’t looking for home runs. Their idea was to get as many runners on base as possible. In other words, they looked for singles and doubles.
And you can apply the same lesson to investing in turbulent markets. Rather than looking to double your money, take some gains off the table when a stock advances, say, 25%, which is still a market-crushing return.
Remember: The faster a stock moves, the more you’ll want to protect some of those “windfall gains” before those momentum traders reverse it on profit-taking.
And no matter what, always take a “free trade” – sell half of your stake – when you book 100% gains. That way you get your original capital back.
From then on, you’re just playing with the house’s money.
Choppy Market Tool No. 3: The Autopilot System
Whenever possible, set yourself up so that you exit a position with specific gains no matter what happens.
That’s where a Choppy Market Tool that I call the “Autopilot System” comes in handy. It’s a unique way of protecting profits with a combination of taking gains and using trailing stops.
It works like this…
Let’s say you sold half of XYZ Tech when it was up 30%. Now you can afford to see if the stock sill has more upside while at the same time protecting your profits against any reversal.
In this case, you could set your stop at your original entry point and walk away with combined gains of 15%. Or, you can set the trailing stop above your entry price to lock in more money.
The beauty of the system is that you set up your minimum profit figure in advance. After that, there’s no need to worry about what happens,
That’s because the Autopilot System is protecting your portfolio.
If This Turbulence Gets Stormier
As you can see, using our Choppy Market Tools can allow you to keep on investing in winning tech stocks – even in in the middle of all this turbulence – and know that we’re prepared for anything the world throws at us.
That means you won’t drive yourself nuts on this Road to Wealth… Paved by Tech.
Now, I’ve just told you how, despite the choppiness we’ve seen in the markets lately, I’m still not worried and see plenty of remaining upside for the best tech stocks.
In other words, while an eventual downturn is inevitable, I don’t see a recession on the near horizon.
However, that’s just my (informed) opinion.
A colleague of mine thinks a big downturn is going to happen sooner than later.
But, like me, he’s got a system for profiting – no matter what happens.
He lays out why the next crash is inescapable… and outlines a series of protective steps you can take before it strikes.
Click here to see this crucial presentation.
Cheers and good investing,
Michael A. Robinson