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Welcome to a Bear Market : StockMarket

You know how people say, everyone is a genius in a bull market? It’s time to check in on all the geniuses.

Fear index (VIX) is soaring, and we’re officially in bear market territory with NASDAQ down over 20% from its high. It’s time to sell expensive volatility and buy cheap equity.

r/StockMarket - Welcome to a Bear Market

VIX up 86% YTD

How to survive a bear market?

  1. If you’re buying shares, dollar cost averaging will help reduce the pain if the stock keeps dropping.

  2. Diversify your holdings. Is your entire portfolio in growth tech? Look into defensive stocks, dividend yielding cyclicals.

  3. Look into sectors that perform well in recessions. Consumer staples, energy and utilities. Financial sector can benefit the six interest rate hikes that are on the horizon.

  4. Focus on the long-term. Are you investing for retirement and it’s still 20-30 years away? In the long run, the bull markets will make up for the bears, as long as you don’t panic and run.

  5. Invest with defined outcome option strategies with high probability of winning and longer dated expirations (12-18 months). Sure it may not be as exciting as YOLOing into a single put, but a put spread will help you preserve your hard won capital and help it grow.

r/StockMarket - Welcome to a Bear Market

NASDAQ down 23% from peak

r/StockMarket - Welcome to a Bear Market

S&P 500 down 12.44% YTD

r/StockMarket - Welcome to a Bear Market

Dow Jones down 9.34% YTD

Positions: 30% VFIAX, 20% dividend portfolio

Example defined outcome strategy:
Hedged options spread on $BTU
76.1% Win probability
Make up to 31.8% (58.1% annualized)
50% cushion
Breakeven $9.88
Invest $1972.64

Buy 1 $19 call
Sell 1 $25 call
Sell 2 $10 puts
Exp 10/21/22


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