The One Trading Strategy You Needed for Yesterday’s Crash

After yesterday – the worst trading day in recent memory – I want to get serious with you about risk.

If you get this right, you could have banked serious profits yesterday.

And I want to make sure you DO get it right.

One of the biggest mistakes investors can make is being too heavily invested in one trend, one sector, or even a single stock. Diversification is a tool that traders use to mitigate risk. The thinking goes, if you spread your investments out, your gains will neutralize your losses and you will yield better returns over time.

Your financial advisor has probably encouraged you to diversify your holdings by buying different stocks in different sectors, some commodities, some gold, and even some downside protection. But it’s difficult for the average investor with a limited budget to diversify in a way that truly cuts risk – experts say you should own somewhere between 25 and 30 stocks for it to really work.

That’s great – if you can afford it. But there’s another way to diversify that your broker or your financial advisor probably won’t tell you about, and it’s a great way to truly slash your risk.

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Why I Like to “Shorten” My Trade (You Will Too)

Last week I loaded you up with information on options timing: the factors that go in to the pricing of an option, what cycles options have, and the option Greeks that determine the premium.

I hope that one didn’t leave your head spinning!

This timing stuff is important if you’re going to put the power of options to work for you.

Now I want to reveal my favorite timing strategy – one I’ve used for over 25 years to “ring the cash register,” and one you can start using right away.

If you’re feeling uncertain about any of this timing, you can always follow along with the “money doublers” I show you here occasionally, or trade along with my Money Calendar Alert subscription service if you’re a member there.

But if you’re a do-it-yourselfer or just the type of person who likes to drill down and see how things work – you’ll love today’s lesson.

Here’s why I like to “shorten” my trade timeframe…

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