Rachel’s note: Here at Casey Research, we’re contrarians. We like to make bets ripe for big gains… while the mainstream is looking the other way.
Our colleague, Jeff Clark, has spent his nearly 40-year trading career betting against the crowd. And he made so much money for himself and his clients, he was able to retire at 42.
Now, you may think you need a degree in finance or a job on Wall Street to be a successful trader…
But you don’t have to be an expert to book some serious returns in this volatile market climate. In fact, Jeff says you could have doubled your money six times so far… in just a matter of days.
On Wednesday, August 26, Jeff’s going to teach his 18-year-old son the same technique he uses to make such large returns in a short period of time. He’ll also give away a free recommendation… and exact instructions on how to place the trade. Reserve your free spot here.
Then, read about Jeff’s unpopular bet on coronavirus that led his readers to over 100% returns in less than a month…
By Jeff Clark, editor, The Delta Report
In early February, I noted to my readers that the S&P 500 just experienced “four straight days of ‘rip your face off’ rallies” – a move of at least 1% higher each day.
This, of course, was happening as the coronavirus pandemic was raging in China, and was just starting to appear in the U.S. I wrote at the time:
Stocks seem to be moving higher just about every day. Investors, ignoring overbought conditions and multiple warning signs, are chasing stocks higher. They’re more afraid of missing out on gains than of suffering through a decline. And, the financial television talking heads are bathing in smugness, once again.
So, I figured it was time to take a contrarian stance. At that time, traders were not rushing to sell out of long positions, or to add exposure to the short side. So, the way I decided to do it was to short the tech sector using the Invesco QQQ Trust (QQQ) – an exchange-traded fund (ETF) that tracks a basket of tech stocks.
Why tech stocks? Because tech stocks tend to lead the market higher in the good times… and lower in the bad times. If we wanted to benefit on a broad market decline, betting against the tech sector was a good way to amplify our returns.
It wasn’t a popular trade. It challenged the prevailing notion at the time that the pandemic wouldn’t reach American soil… which is hard to imagine now.
So, as time went on, it became clear we were right. The U.S. was not impervious to the pandemic threat. And, by February 26, the S&P 500 fell more than 100 points – giving up all of its gains for February, and for the year-to-date.
After that, we took advantage of the volatility and closed our recommended trade less than three weeks later with a gain of 111%.
Take a look…
(Click on the chart for an enlarged image.)
Now, how did we conclude that tech stocks would fall as the broad market was racing higher? It’s all thanks to what’s probably the most important mantra of my trading technique: Periods of low volatility are always followed by periods of high volatility, and vice versa. When things are complacent in the markets, you can almost always count on that to change, in either direction – and rapidly.
Another key to taking advantage of volatility is making sure we’re not making brash decisions by playing on emotions, or trading in overbought and overextended conditions. It doesn’t end well. I’ve said before that the stock market is a “cruel mistress” – she will have her way with you if you don’t keep your emotions in check.
And, if we’re jumping over to the bullish side of the cruise ship in a frenzy, the boat will inevitably tip over. Logic is important, despite the sometimes enormous pressure to think otherwise.
Editor, The Delta Report
P.S. When you trade like I do, there are always opportunities to book massive profits – both from the upside and downside.
So, on August 26 at 8 p.m. ET, I’m going live with my son Carson in an attempt to double his money with my trading technique… and you’ll get to watch every moment of our training session, from start to finish, at RealMoneyDemo.com.
You’ll also receive a FREE recommendation during the event… a chance for you to place a single trade the morning after the event, which could double your money. Click right here to sign up.