Tradingconceptsinc – Hindenburg Strategy

Tradingconceptsinc – Hindenburg Strategy

Description of Hindenburg Strategy

Here’s a simple way to stop fearing the next bear market – and how to profit from it …

How to Profit from the Next Market Crash

Dear Options Trader:

Like an approaching season, you know it’s coming …

You may not know the exact date …

You may not know the time …

You may not know the reason …

But as sure as winter brings snow, you know that the next bear market sits on the horizon … just waiting to pounce on your investments.

And, if history is any indication, we’re due.

Since 1961, the time between the biggest bear markets averaged 6-8 years – the most recent ending in March 2009.

No need for a calculator to figure out we’re getting close…

Today’s market is already more volatile than we’ve seen in a long time. And if you’re a typical trader, the potential gloom scares you.

But I have feeling you’re different.

After all, you’re here … and I know Trading Concepts students are unique.

You’re likely an investor who trades rather conservatively.

Of course, you enjoy profits too.

But, ultimately, your goal is to trade full time or continue supplementing your retirement or employment income.

Am I right?

Well, that’s why I want to show you how to position yourself on the right side of an impending decline – so you turn disaster into opportunity.

Furthermore, I want you to have this simple protection strategy so you can sleep at night, knowing your assets are safe – regardless of which way the market moves.

But first, please understand …

Nothing builds wealth faster than a correction or bear market.

This concept might seem foreign to you. After all, you’re likely used to making most your profits when the market rises.

And that’s fine …

However, the fact is, considerable effort is needed to set the market in motion. This struggle is no different than you pushing a boulder up a steep hill.

Your effort increases with each step. But then, once you reach the top and start down the other side, what happens?

Not only does gravity push the boulder down, but – just like the market – it picks up momentum as it drops.

A market may take years to build in value. But when the moment is right, a drop can create massive damage in days as prices tumble.

No doubt, you saw this happen before (remember the “financial crisis” in 2008?).

So what have you done to take advantage of the opportunity when it happens again?

You see, there’s no way to safely enter a bear market or correction after it’s identified. If you know the market is correcting, you’re already too late to participate.

The Secret to Best Positioning Your Trade Before a Correction Begins

Let’s just cut to the chase …

There’s not a more explosive trading instrument than a long, out-of-the money put option during a corrective move.

If you haven’t already, watch the example in the video at the top of this page. You’ll see an out-of-the-money put option that went for about $31 a contract. Just five months later, it was selling at $932 a contact.

That’s about a 30-to-1 return on your capital!

Imagine if you set aside $5,000 for this strategy. It would have turned into a staggering $145,000.

So while everyone else’s portfolio is bleeding, yours would have been bright green.

Gains like this make for a pretty comfortable retirement, don’t you think?

Now, if you’re familiar with my teachings, you know I’m not one for hype. I’m a very conservative trader who emphasizes risk management.

So I understand if you’re skeptical of this strategy. In fact, I don’t blame you. Perhaps you’re wondering “What’s the catch?”

Well, here it is:

Success using this strategy requires a system. So let me explain it as briefly as possible …

I call this system the Hindenburg Strategy.

What will you learn in Hindenburg Strategy?

Step 1: Identify your market. Preferably, pick a market you’re going to trade over and over again. I like the S&P 500. You may like something else better.

Step 2: Establish your starting capital. This is money you won’t use for any other trading strategy.

Keep in mind, though, all these funds do not represent risk capital. (You’ll understand why in just a minute.)

Step 3: Establish offensive metrics for your put Options. I typically buy put Options that are 10% out of the money to anticipate corrections.

Then I’ll buy them further out-of-the-money when we approach bear territory (based on the signs and signals I follow and will show you).

I also give myself enough time for the trade to work out, usually buying at least 3 months of time for the Options.

Step 4: Establish closing metrics for your put Options. At what point will you either remove your put Options for a profit – or just let them expire?

You must define this before entering the trade, so you follow the system.

Step 5: Establish your long put option – and then do this every month.

Now, before going any further, let me give you a quick warning …

After a couple of cycles of following these steps, many investors get bored and the strategy falls apart.

You see, you might buy your put Options and then watch every month as the market moves higher. So you stop buying them because you tire of seeing your positions expire out of the money while your capital erodes.

So you give up right before the next big correction.

And that’s why you need …

Step 6: Set up Option spreads to “finance” the purchase of your put Options. Typically, I use vertical credit spreads. So if your long puts expire worthless, you don’t see a drop in your capital.

These spreads pay for the long put trades.

Step 7: Roll your profits into your capital. The idea here is you see a number of small corrections that produce some profits – although not likely the 30-to-1 profits we discussed earlier.

So you keep growing your stake.

That way, when the real bear comes, you have a larger position to take advantage of the bigger move.

Step 8: Rinse and repeat. Simply continue taking the same steps every month.

Once you get comfortable with the process, this management requires a mere 15 minutes every 30 days.

More courses from the same author: Tradingconceptsinc