The 20 Rules Of Surviving A Market Crash
143: No crying in the casino...
Welcome reader! What a wild few days it has been in the financial market. So much so that we feel obliged to share our 20 rules for surviving a market crash and making the most of it.
Surviving The Bad Market - Getting The Most Out
1. Don’t open your broker account. Don't check your portfolio. Don’t open up your crypto wallet. If you want to take it further… Delete all the trading and investing applications from your mobile phone. That is the only way to eliminate emotions from the game.
2. For those in a position where the market crash forces them to sell their assets, it only means one thing. They are doing something wrong. Your predictable cash flow should manage everything and allow you to avoid touching any of your investments when everything crashes. Quite the opposite you want to be buying more of them.
3. Stop wasting your time trying to predict what will happen. What you need to understand about financial markets is that those predicting what will happen to the market know as much as you do… They don’t.
4. It is never your fault. Always blame the FED.
5. Those who claim they have a strategy when the market crashes are selling you something. Once the market begins to react, it is too late to develop strategies. The only effective strategy would be the one where you have sold everything at the peak.
Anybody who plays the stock market not as an insider is like a man buying cows in the moonlight. - Daniel Drew
6. Your work colleagues will be miserable for a month or two. It is not because they are sleeping poorly or having a rough period. It is because the market wiped them out. Most of them are going through a reality check and realize they won't be able to afford a vacation this year. This is when you will have an easy time outlapping them and impressing those who matter. Understand corporate cheat sheet.
7. If your crypto meme portfolio is performing better than your stock one… You need to forget about your investing strategy. Your new stock approach should be to invest everything into the S&P500 and forget about it.
8. Remember that crypto investment your friend told you about that was supposed to triple but is now down 93% from the original price? You didn’t invest in the asset. You paid someone’s rent for a Lambo.
9. A clear indicator of having total control over money is whether you buy or sell when the market crashes. Those who possess control? They are the ones buying. This is a general rule and an easy way to check on others. It tells you a lot about their position without them revealing too much.
10. Having a positive outlook on the market is half of success. There is never a bad market. There is always a positive correction.
11. The investing game should only be played on a scale of 365+ days. Everything else for the big majority is a waste of time and energy. Better said, if you are broke and don't have enough not to touch it for at least 365 days… You should not bother investing. Your priorities would be better spent on ensuring you are in a comfortable position.
12. There is always the same pattern when the market crashes and who ultimately wins. Liquid ones. There is a good reason why Buffett is sitting on over 300 billion at the time of writing this.
13. There is no denying that we are all operating in a new world where nothing make logical sense anymore. Imagine having a digital currency without any utility called Fartcoin that performs better than half of the tech stocks out there.
14. To offset what you lost during Monday's market opening. You should try to make it back during the weekends by betting on female college basketball. Extra points if you are taking care of the team cycle.
15. The next time your better half asks you about the difference between a long-term strategy and a short-term strategy, remember this: When your portfolio is down 30%, that is a long-term strategy. When your portfolio is up 3%, that is a short-term strategy and a clear sign to take profits.
16. Big Short and Margin Call are great movies to rewatch and remind yourself who you are trying to beat. Also, it's a good reminder of why you won’t beat them.
17. Before the weekend family dinner, you need to prepare yourself. There is a 90% chance that one of the family members (grandma or aunt) will ask how your investments are doing. When that happens, you must be ready to look at your phone as if it is going off. That is one of the easiest ways to avoid damaging an old lady’s health by making her worry about whether you will be able to eat tomorrow or not. Once you are back at the table, pretend that the question never happened.
18. Never forget that allocating some of your cash to buy crypto coins when marketing crashes is a good idea. Nothing is better than betting on a dog or a frog coin whose value will triple up and make up for your wrong prediction about the stock market. You will never understand this until you try to pull it off. Few.
What are the odds that people will make smart decisions about money if they don’t need to make smart decisions—if they can get rich making dumb decisions? The incentives on Wall Street were all wrong; they’re still all wrong. - Michael Lewis
19. DCA is the best strategy out there. More so when the market is down, and there is a correction. The only requirement is that you have some dollars left to invest in the first place.
20. After a few market crashes, there is a big realization. The only way to lose this game is by selling your assets for less than what you paid them. Try to get out of your emotional phase. Have capital ready. Ensure your portfolio is not extremely risky. Wait for the market crashes. Buy on the discount. This is an impossible to beat approach and the only one you need to know about. Remember losers sell when the market crashes while winners buy. You know what you need to do…
We could not help ourselves with this post, considering what has been happening and what kind of messages we have received about investments. Our advice? Hold tight. Q2 looks like it will get wilder. Luckily, for anyone who has been following us… 50% of the sarcasm found here doesn’t apply to you. If you are new, start by understanding risk management and how to invest your money. Situations like this one and the corrections behind them are necessary. They allow those without significant assets to become asset-heavy. Market corrections should be seen as sales…
Disclaimer: None of this is to be legal or financial advice of any kind.
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