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Three Key Habits of a Successful Crisis Trader

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Legacy Research Group

April 12, 2022

Chris’ note: 2022 is setting up to be a volatile year. We’ve already seen falling stocks… rising inflation… and war in Ukraine. But fear not… At the Cut, we’ve been sharing the best ways to not only protect your wealth, but also grow it in these turbulent times.

Today, you’ll hear from master trader Jeff Clark. He’s made some of his best returns for himself and his readers in times of crisis. And tomorrow at 8 p.m. ET, he’ll show you how to do it too. He’s hosting a free live demo with his 22-year-old son to prove how easy it is to learn these strategies.

So make sure to sign up for that here. Then read on for the three habits Jeff says every trader needs to thrive in crisis conditions like we’re facing today.

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Three Key Habits of a Successful Crisis Trader

By Jeff Clark, Editor, Delta Report

Jeff Clark

Stock market crashes are brutal for most investors.

You watch your gains build up over the years. Then they evaporate over weeks… or even days.

But you already know that if you had money in the markets this year.

From its all-time high in January, the S&P 500 has dropped as much as 8.6%.

The tech-heavy Nasdaq has plunged as much as 17% from its high the same month.

And the losses have been much worse for high-flying tech stocks.

It’s been a far cry from the past two years when just about everything was ripping higher.

The sentiment shift caught folks off guard.

Their nest eggs have shrunk… and those who bought into the highs last year are nursing painful losses.

But as I’ll show you today… it doesn’t have to be this way.

It’s true that market crises wipe out many fortunes. But it’s also true that you can make many more fortunes in the aftermath.

In fact, some of my best trading years were during times of extreme market crisis.

If that sounds absurd to you, keep reading. I’ll prove that you can achieve similar results starting today.

Crisis = Opportunity

During the lead-up to the Black Monday stock market crash in 1987, I multiplied my money 10 times.

Then, in the 2001 tech wreck, my trades gave me and my clients at my former brokerage firm a seven-figure windfall.

(I sold and closed that firm at the end of September 2007 – which surely qualifies me for some sort of market-timing award.)

If you’d followed my recommendations in the 2008 financial crisis, you could’ve doubled your money – or more – on 18 different trades.

It all has to do with three key trading habits that most everyday investors don’t practice…

Success Habit No. 1 – Fight the urge to trade with the crowd

In other words, be a contrarian.

This is harder than it sounds.

When the market marches higher each day, it’s uncomfortable to sit on the sidelines and wait for a more profitable entry point. Seeing the gains other folks are making doesn’t help either.

But there’s a big difference between the investor who bought toward the end of last year and the one who didn’t.

The former is praying the market will come back to where it was before the crash.

The latter is happily buying stocks at a discount…

Success Habit No. 2 – Remember that what goes up must come down

When it seems a rally will go on forever, that’s when the party usually ends.

Often, the last legs of an overextended rally draw in the least-informed investors and cause massive losses for them.

Bill Gates and Fellow Billionaires "All In" on This Small-Cap

Knowing how to recognize these moments is key to finding opportunity in markets in crisis.

Sometimes that means sitting on the sidelines as the rally continues. That’s the essence of being responsible trader. Because stocks that keep climbing will eventually fall.

But the reverse is also true. So if your positions are already down, don’t panic sell. Hold on for when these stocks inevitably bounce back up.

Success Habit No. 3 – Make the uncomfortable trades

A lot of investors are uncomfortable right now.

Inflation is tearing through our economy. And the war raging in Ukraine is sending energy and goods prices soaring.

Many of last year’s stars have become this year’s losers.

Financial services company Robinhood (HOOD), exercise equipment company Peloton (PTON), and e-commerce platform Wish (WISH) were all tech high-flyers that are now down more than 80% from the all-time highs they made last year.

But it makes more sense to buy in at the current levels.

The most uncomfortable times to buy into the market often wind up being the most profitable. Because the less you pay for a stock, the more you make as it goes up.

Golden Thread

A golden thread ties these habits together. To be a successful crisis trader, you need to control your emotions.

We humans are emotional and irrational.

Greed and fear constantly pull us in opposite directions.

Recognizing, controlling, and counteracting these emotions are essential.

It’s not easy. But it’s doable.

And I want to show you how.

So tomorrow, I’m teaching my 22-year-old son, Grant, everything I know about trading. Last year, he barely knew what a stock was. Now, he’ll put his own money to the test live on camera.

You’ll see if he doubles his money – or loses it all.

If buying and holding hasn’t worked for you in the last few years, you’ll want to see what my strategy is all about.

You can tune in tomorrow at 8 p.m. ET to watch. It’s totally free…

I’ll even give you the name of one of my recommendations just for attending. So you can try the techniques you learn for yourself.

To sign up for my demo, go here.

Best regards and good trading,

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Jeff Clark
Editor, Delta Report

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