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Message
Stock strategy for a market correction.
Posted on 2/5/21 at 9:13 am
Posted on 2/5/21 at 9:13 am
This is hypothetical as I'm not planning on making any changes anytime soon. I just want to have an idea of the possibilities out there.
Without doing shorts, are there any stocks I could hold that would take off in the event of a correction?
Without doing shorts, are there any stocks I could hold that would take off in the event of a correction?
17
Posted on 2/5/21 at 9:21 am to OysterPoBoy
Not sure why you got downvoted but this is a good question and a timely one. I myself am interested in securing the gains without severely capping future gains.
Posted on 2/5/21 at 9:37 am to OysterPoBoy
I think it would be tough with simply stocks, unless you're willing to buy inverse ETF's, which personally I'm not.
Aside from just buying less risky stocks, especially high-dividend yielding ones, I'm not familiar with a straight stock strategy.
Aside from just buying less risky stocks, especially high-dividend yielding ones, I'm not familiar with a straight stock strategy.
Posted on 2/5/21 at 9:39 am to OysterPoBoy
Sell stocks at peak and buy real estate
Posted on 2/5/21 at 9:43 am to jimbeam
quote:
Sell stocks at peak
Got it.
Posted on 2/5/21 at 9:44 am to OysterPoBoy
Posted on 2/5/21 at 10:17 am to OysterPoBoy
I like to have extra cash on hand for the buying opportunities. I got lucky back in the middle of March with high liquidity.
Posted on 2/5/21 at 10:43 am to OysterPoBoy
You can explore minimum volatility funds that typically offer some downside protection. Buying something that actually goes up when the market goes down is a different story altogether. Typically it would be bonds, but at these yields that may not be the case.
Posted on 2/5/21 at 11:10 am to OysterPoBoy
I've been focusing on fundamentals and value lately. Also, a correction also usually brings volatility, so some money in a fund based on VIX could be a good hedge in this instance. I have a chunk of money I keep in such funds. When VIX spikes, I buy an inverse fund SVXY. When it drops back down I sell that and buy VXX. When it goes back up, I sell that and buy the inverse fund again.
Posted on 2/5/21 at 11:16 am to Auburn1968
Same as me...I just happened to have a decent bit of cash when the market bottomed out. First time I’ve been able to take advantage of it like that.
Posted on 2/5/21 at 11:47 am to OysterPoBoy
quote:
Sell stocks at peak
Got it.
Alright you got a laugh out of me.
Posted on 2/5/21 at 12:15 pm to rintintin
just bought 3x inverse for the weekend. S&P
Posted on 2/5/21 at 12:19 pm to Utah Tiger
Bold Strategy. Good Luck
Posted on 2/5/21 at 1:14 pm to OysterPoBoy
I'll give you a few examples of stocks that didn't hurt too bad in 2008. McDonalds and Walmart. Consumer essentials that people will consume just as much if not more during a recession. 2020 probably isn't the best crash to use as a future predictor given that it was almost entirely caused by an external event that affected different segments of the economy in drastically different ways.
Depending on the situation, I'd also prefer a stock going into a recession that is already undervalued rather than trading at a high multiple due to anticipated future growth. So an example of the perfect combination of consumer essential and undervalued stock might be Kraft Heinz. Something like Peleton would be the worst kind to own if you think hard times are coming.
Depending on the situation, I'd also prefer a stock going into a recession that is already undervalued rather than trading at a high multiple due to anticipated future growth. So an example of the perfect combination of consumer essential and undervalued stock might be Kraft Heinz. Something like Peleton would be the worst kind to own if you think hard times are coming.
Posted on 2/5/21 at 1:19 pm to OysterPoBoy
What are you looking to do? Do you want to hedge your individual stocks with puts? Inverse etfs? Buy bitcoin?
This post was edited on 2/5/21 at 1:21 pm
Posted on 2/5/21 at 1:21 pm to hiltacular
I was just looking for something I could buy now and hang onto that would pay off in a correction.
Posted on 2/5/21 at 1:31 pm to OysterPoBoy
I follow some pretty knowledgeable people on twitter who have a decent signal to noise ratio on warning of possible volatility/corrections/crashes incoming
Posted on 2/5/21 at 2:52 pm to ldts
quote:
I've been focusing on fundamentals
In this market?
Posted on 2/5/21 at 3:19 pm to audioaxes1
quote:
some pretty knowledgeable people on twitter
Drop some handles!
Posted on 2/5/21 at 3:37 pm to LSU Tigershark
quote:
In this market?
Yes, there's some good value out there if you're willing to put the work into it. A lot of these stocks are really getting ahead of themselves.
I don't see what's so funny about that, there's ways to make money other than chasing the same few tech stocks everyone else is chasing.
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