"A lot of people probably forgot we had a 20% sell-off last year. It started in February slowly and by the time early April had rolled around we were at least intraday levels on certain industries in correction or bear market territory. So it could happen again."
"Using margin when times are good is dicey, but if things get bad and your portfolio is heavily margined you can lose a huge portion of it. You could lose 50% or 60% and you could lose it fast because when markets go down they go down a lot faster than they go up."
"One thing you do right away is try to move some items to cash. If you can move to cash, move to cash as much as you can. You don't have to sell everything but move to cash."
Market analysts predict a 20% correction will occur by midyear despite recent record highs. Investors have become accustomed to continuous gains and may have forgotten the 20% sell-off that occurred last year, which recovered quickly in a V-shaped pattern. To prepare for potential downturns, investors should move portions of their portfolios to cash, eliminate margin debt to avoid amplified losses during market declines, and consider adding precious metals for diversification. These strategies are particularly important for those nearing or in retirement who cannot afford significant portfolio losses.
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]