It may be hard to feel at ease right now with the rising tensions between the U.S. and North Korea – and rightfully so. This isn’t something we can expect to go away anytime soon. And we’re not likely see a change in pace of the ’round-the-clock breaking news alerts, either…especially after the recent drop in the stock market.
But despite the gravity of this situation, I’d caution against making any significant investing and trading decisions based on the news cycles. That’s actually the fastest – and most surefire way – of putting your retirement savings at risk.
And that’s the last thing I want to happen to you.
So today, I created a list for you of the eight stocks you’ll want to hedge against North Korea market fears – and the best way to play them.
Now let’s get started…
Protect Yourself – and Make Some Money – Using Defense “LEAPs”
Before the latest threats from Kim Jong-un came in, the United Nations (UN) Security Council unanimously passed a resolution that imposes new sanctions on North Korea because of its ongoing intercontinental ballistic missile (ICBM) testing along with their violations of UN resolutions. These are the strongest sanctions ever imposed and also ban countries from hiring any additional North Korean workers.
As you saw, North Korea’s immediate response was “the U.S. mainland will sink into into an unimaginable sea of fire,” and there are reports now claiming that they have the capacity to launch a miniature nuclear warhead inside of a missile. Whether or not you believe this is all just “crazy talk” from Jung-un, the fact of the matter is that the U.S. government and military are taking it extremely serious – and are doing everything possible to deescalate and protect against any acts of war.
That means defense companies are going to be seeing a continued increase in their sales and revenue…
… which means this is where you want to put some money to hedge against a volatile market.
Related: While you’re distracted by North Korea, here’s what the media doesn’t want you to know…
And according to my proprietary tools, there are eight defense stocks trading at their 52-week highs right now:
Keep in mind that we’re looking at a situation that’s likely to continue for some time. So when it comes to trading strategies to use, I wouldn’t recommend anything in the short term. Instead, consider buying Long-Term Anticipation Securities (LEAPs). Here’s a quick “cheat sheet” about them:
Now if you’re new to options and are still waiting to get your account set up and your clearance, a stock that’s not optionable (one in which you can’t trade options) and worth considering for your portfolio is the the iShares U.S. Aerospace and Defense ETF, (ITA). This is the largest defense ETF, by way of assets, and is currently trading at all-time highs. Additionally, it holds all of the eight funds I listed above.
And as always, be sure to talk to your broker about what’s most suitable for your needs.
To your continued success…