Editor's note: Monday was the worst day in U.S. stocks since the 2008 financial crisis. Most folks are wondering what they should do next... And more important, if now is the time to panic.
But according to Steve, panicking is the wrong move today. He put out an update to his paid subscribers last Friday explaining why. And he tells us that his advice remains the same – even after Monday's brutal sell-off.
So today, we're doing something a bit different. We're publishing Steve's Friday note. Normally, we'd reserve this content for paid-up subscribers. But given the wild market action, Steve has agreed to share it here. Read on for the details...
I have personally lost a lot of money in the last two weeks. I'm sure you have too.
It feels awful, I know. It's heavy out there... As I write, the S&P 500 is down 13% from its all-time high on February 19, and interest rates have fallen to record lows.
So you may be surprised to hear this... but I am extremely excited to buy...
No, I haven't bought yet. But I will personally be a big buyer very soon – when we start to see the beginning of a new uptrend.
Unless the next global financial crisis is upon us – which I don't think is the case – then soon we will see the best buying opportunity in the stock market since Christmas 2018.
Investor sentiment is absolutely terrible out there. But here's the thing: You want to buy assets when they're hated...
Once U.S. real estate became incredibly hated in 2011, and investors lost faith completely, I started buying real estate heavily here in Florida.
It was the first time in my investing career that real estate was THAT hated. So I bought all I could – and then some. Since then, I've made incredible profits on it.
Today, stocks are incredibly hated. Investors have lost faith. Meanwhile, the economy (to this point) is doing well, interest rates are at record lows, and stocks are not expensive.
In my opinion, this will turn out to be the last great buying opportunity of the Melt Up.
As I said, I have lost a lot of money so far. I want to limit my own losses – and yours. So we will follow our trailing stops. We genuinely can't know when the negative sentiment will change. It could be tomorrow. It could be a week from now... or even a month from now. We also can't know the path the coronavirus will take.
I expect the extreme fear will fade away sooner rather than later. But as I mentioned earlier, I have not personally bought yet. I am waiting for more of a sustained uptrend. I am waiting for things to get "less bad."
When that happens, I will likely load up on stocks... for the first time since the end of 2018.
Times are bad right now. But they won't be bad forever. I believe we will have a fantastic buying opportunity, soon...
I look forward to guiding you through it. When the trend returns, we'll be ready to put money to work.
Stay safe. Don't stress too much. Follow your trailing stops to limit your downside risk. And consider being a big buyer sometime soon...
Good investing,
Steve
Further Reading
Most novice investors execute their trades backwards. Instead of reducing risk, they'll actually find a way to take on more. But using this simple technique, you can increase your potential profits and reduce your risk... Get the full story here: The Pro's Strategy for Increasing Profits and Reducing Risk.
"You must consider how your portfolio will handle a huge downdraft," Austin Root says. If you aren't prepared to withstand choppy action or pullbacks in the market, you may need to adjust your holdings. Thankfully, knowing how to play it safe can give you a major advantage... Learn more here.
Today's fear is setting up a major buying opportunity. And taking a simple 30-second quiz can help highlight some of the best stocks to buy when the uptrend returns...
THE MARKET SELL-OFF SPARED CLEANING SUPPLIES
Today's chart shows a company that's just right for today's market environment...
Longtime readers know that certain businesses thrive in times others are troubled. Economic uncertainties can benefit gold miners. War threats drive up "offense contractors." And when coronavirus fears have everyone disinfecting their surroundings, investors are betting on this company...
Clorox (CLX) is a $20 billion consumer-products manufacturer, centered around its line of bleach, disinfecting wipes, and other cleaners. Thanks to their public-health value, these products will remain in high demand even if the broader economy takes a hit... Not only that, but Clorox has increased production in response to the coronavirus. Other Clorox brands are similarly "recession proof," such as Glad trash bags and Fresh Step cat litter. In total, the company made a $185 million profit in the most recent quarter... up about 2% year over year.
While the market fell sharply in recent days, CLX shares have held fairly steady. They're up about 70% over the past five years and remain near all-time highs today. That's the stability we expect from companies that sell what folks always need...
