Life isn't fair. Life isn't convenient. Life can straight up suck sometimes.
If you can remember one of the lowest points in your life, it should serve as a reminder of your rise from the ashes…
Because there always comes a time when the market crashes and burns.
But even if the market reaches its lowest economic downturn, it can serve as your greatest opportunity for reward and profit.
The question to answer is whether you're in the right place at the right time.
Surviving the Crash
- You know you're in a depression when it brings long periods of:
- Unemployment
- Drop in consumer spending
- Limited access to credit
- Bankruptcies and business closures
- Panic
All you have to do is look up instances of the Great Depression in 1929, the housing crash in 2007, and the global pandemic of 2020.
March brought about a 25% downturn in the global markets, an oil price war between Russian and the OPEC, and Wall Street had its biggest single-day percentage drop since 1987.
Hindsight was truly 2020.
But despite hitting the lowest point, depression in the market cycle can be used to your advantage…
If the situation presents itself.
Down but Not Out
Just as the market reaches a cycle of euphoria and presents the biggest risk, the depression allows for the biggest reward.
If you weren't vastly affected by the market crash and still have some capital, you may be able to buy some securities or assets for a bargain price.
In fact, oil prices turned negative in April 2020 so oil companies would even pay you to own stock or oil.
This was due to the fact that oil producers wanted to avoid storage costs. That only goes to show the fear one trader feels during a depression can be excitement for another.
Be sure to do your due diligence though. Just because certain securities fall below a certain price doesn't always mean you're "buying the dip" in hopes of making a profit.
Ensure that you use protective measures to protect your account and that you are buying at the lowest point before that security rises from the depression phase.
It's Not Over Until It's Over
Stock market crashes are not fun but they are inevitable due to historic events and cycles. But if you're one of the lucky ones and stay level headed with your trading…
You can rise above the panic and the fear.
You can even seek out other opportunities and bargains other traders miss out on. It's not over until it's over.
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