Editor’s Note: Any investor knows that most brick-and-mortar stocks are falling faster than ever. But buying shares of their rising e-commerce competitors – AMZN, BIDU, and BKNG (formerly PCLN) – can be overwhelmingly expensive. Fortunately, Tom Gentile discovered a way you could double your money on these soaring companies in 4 days or less… starting with as little as $500. Sound impossible? Click here to see it for yourself.
By the time you read this, a beloved retail toy store may have closed its doors…
Last September, Toys ‘R’ Us filed for bankruptcy.
They’ve already closed 180 of their 800 stores, but shutting them all down was never part of their original plan (it never is). Expectations were for a restructuring of the company that would prevent that from happening.
Fast forward to today, and the news is that they could be announcing the closing of their remaining stores permanently – as early as this week.
Now for many, this is pretty unsettling news. Toys ‘R’ Us has been a household name – a childhood favorite. Making that trip to the pick out the perfect toy for being good or getting outstanding grades was something a lot of us looked forward to when we were kids.
And for parents, the memories of battling holiday mobs to get the last Tickle Me Elmo or a Cabbage Patch Doll is still brings laughter to the family table.
So hearing that another goliath like Toys ‘R’ Us – one you’d always think would be around – is enough for some traders and investors to start dumping all of their retail shares.
But that’s actually one of the worst things to do – especially to your portfolio.
Here’s why…
It’s Not Too Late to Turn a Profit on Brick and Mortar Stores
We’ve talked about the challenges in retail before.
And at times like, I favor trading strategies like going long puts or using bear put spreads to take advantage of stocks I feel are going to trade lower.
But the opposite stance would be to look for bullish option trading opportunities in the ever-growing e-commerce field, like Amazon.com, Inc. (AMZN) or a Baidu, Inc. (BIDU).
And that’s the great thing about being an options trader.
You can always position your money in a manner that can make gains based purely on your assessment of the company’s future – whether up or down.
For example, if you own shares of Hasbro, Inc. (HAS) or Mattel, Inc. (MAT), you may be feeling nervous about the series of downs it has seen over the past few weeks…
But at times like this, there is no reason to let your nerves take the lead. Just step back and assess the situation…
Your first option would be the long-put route. This would mean you believe the company will continue to drop in price. Or maybe you believe the company will weather the storm and come out mostly unscathed on the other side…
This is done by slowing down, crunching the numbers, and analyzing the charts – but mostly it’s done by ignoring the headlines and sticking to your strategy. It’s easy to get caught up in the ” it’s the end of retail as we know it” headlines stating that brick and mortar retail is dead. It’s easy to listen to the analyst’s warnings that retail is a sector that you want to stay away from. And I admit that even I’ve even been a bit more skeptical of the retail sector lately…
But I was curious to see which retailers with a brick and mortar presence are holding up better than the world thinks. So, I analyzed the holdings of the XRT: the SPDR S&P Retail ETF.
The list above shows the top 10 stocks in the retail sector that are at or closest to their 52-week highs. Stocks at their 52-week highs are often considered momentum stocks, and though momentum and retail aren’t two words we’d think go hand in hand — the proof is in the data.
Obviously, the top four stocks, Booking Holdings Inc. (BKNG), Amazon.com, Inc. (AMZN), Shutterfly, Inc. (SFLY), and Netflix, Inc. (NFLX) are almost exclusively online companies, but the remaining six are still considered a brick and mortar, physical free-standing buildings, presence.
So, the next time you hear a so-called expert say retail is dead, just show them this list.
Even better… just take a breath, shut down the anxiety, and know that you are educated and trained to look beyond the headlines and find the opportunities where others simply can’t. If you still consider yourself a Toys ‘R’ Us kid through and through, you’ve still got your memories of those wonderful times.
But as an options trader, know that there are always new opportunities on the horizon – even on the most expensive stocks in the market…
Profit from the “FANGs” Without Getting Bit
Now, when it comes to trading the big boys… Amazon, Netflix, Booking Holdings Inc. (formerly Priceline Group Inc.)…
The companies pioneering technologies that are shaping tomorrow’s future today…
Soaring companies that some folks – for 100 shares of stock – are paying upwards of $50,000, even $100,000 or more…
You need to look at their decade-long, common sense patterns.
Patterns so obvious, it would be hard to not spot what was coming next. I use these patterns to recommend unique trades that always have the potential to double your money fast… about 15 days on average…
Sound impossible?
Well, let me show you how – with just one extra click of your mouse – my proprietary strategy can help you take advantage of an amazing market “loophole”…
And grab huge cash by leveraging the hottest stocks on the planet… for pennies on the dollar.
Hardly anyone knows this even exists… let alone how to manipulate it to their maximum benefit.
But I’m sharing more about this secret with you right here.
Until next time,
Tom Gentile
America’s #1 Pattern Trader
