Dear Reader,
It was a bleak, rainy morning when I came across a troubling scene on the road.
It was a normal weekday day for me.
I slipped on my raincoat and rainboots and made my way to the car.
It wasn't a heavy rain, but it was cold and constant — the worst kind.
I like taking the back roads when I drive, so I've got a good scenic route into the office (as scenic as you can get in Baltimore).
As I was coming down a big hill, I saw something strange in the distance.
An animal was running back and forth in the road.
As I got closer still, I could make out that it was a dog.
That's weird, I thought.
Then it ran straight in front of a bicyclist coming the opposite direction I was traveling.
The cyclist wiped out trying to avoid the dog and landed straight on his head.
The dog ran away to its owner (both disappeared from this whole ordeal after the fact, by the way) as I came upon the scene.
I stopped the car in the gravel and walked up to the downed cyclist.
He was older, probably in his 60s.
I asked him what had happened. He seemed confused but remembered enough to tell me that a dog had run out in front of him. Talk about bad timing for this poor guy.
He clearly had a concussion and luckily, there was already another person on the scene who called 911.
To add insult to injury, it just kept on raining.
But I didn't want to move him in case he had a spine injury.
So this old guy's just laying on the side of a Baltimore backroad in the rain, delirious, bloody, and confused.
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The person who called for an ambulance left, so I'm the only one there.
But luckily a guy pulls up in a truck. He puts the man's bike in the truck and gives him some water. Being prepared is always a good thing.
Nevertheless, I felt like I had to stay until help arrived.
The ambulance arrived on the scene, and I left with a good water cooler story for the day.
Now, I tell this story for one reason...
The importance of protecting yourself.
Had this man not been wearing a helmet, he could have suffered far worse than a concussion. For all we know, he could be dead. After all, he landed straight on his head.
My doctor once told me that a smart man goes through this world well-sheathed.
The same is true about the smart investor. You don't want to risk all your money without wearing a helmet.
That means you have to know how to play both sides of the market, i.e., hedge your bets.
Here's what I do.
The stock market has evolved greatly since its inception. There are now leveraged plays and bets on volatility.
Take the CBOE Volatility Index (VIX), for example. The VIX is a measure of market expectations of near-term volatility conveyed by S&P 500 stock option prices. It is commonly referred to as the "fear gauge" or "fear index" because it tends to increase when market uncertainty and fear are high and decrease when investor confidence is strong.
The VIX uses options on the S&P 500 Index. Specifically, it selects a range of call and put options that are near the current index level and that expire within a certain time frame, usually within 30 days.
The VIX is quoted in percentage points and represents the expected annualized change in the S&P 500 Index over the next 30 days, based on option prices. For example, a VIX value of 20 implies an expected annualized change of 20% over the next 30 days, up or down, in the S&P 500.
Traders and investors use the VIX as a tool to gauge market sentiment and risk. High VIX values suggest increased market volatility and uncertainty, which may indicate potential downturns in the stock market. Conversely, low VIX values suggest reduced volatility and greater market stability.
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Overall, the CBOE Volatility Index provides market participants with valuable insights into investor sentiment and expectations regarding future market volatility, which can inform their trading and investment decisions.
Now, you can buy the VIX itself or play inverse-leveraged exchange-traded funds (ETFs) that track the VIX. In my brokerage, it's the ProShares VIX Short-Term Futures ETF (VIXY). You can even play options on the VIX through this ETF.
I keep a small amount of my total portfolio in the VIXY in case the market crashes. It will at least ease the pain slightly.
And to make sure you're not constantly in a bullish stance, make sure to find some inverse-leveraged ETFs on popular stocks like Nvidia and Tesla.
Let's say you bought Nvidia at the top and are kicking yourself now because it's been selling off.
Well, you can protect yourself by buying the T-Rex 2X Inverse Nvidia Daily Target ETF (NVDQ), which moves at 2 times the inverse of Nvidia.
So if Nvidia goes down, this goes up.
It's a wonderful way to play both sides of the coin.
And as Nvidia continues to correct, there's another stock you need to take a look at.
My colleague Keith Kohl just uncovered the most unlikely winner of this AI gold rush...
And it's NOT ChatGPT, Apple, Microsoft, Meta, or even Nvidia.
Heck, it's not even based in Silicon Valley. Instead, it's hidden in a small suburban town outside of Chicago.
And this AI firm isn't just working with big tech giants; it's the backbone of their operations.
Apple, Amazon, Samsung — they are all already partnering up with this under-the-radar firm.
Why? Because its tech is integral to the explosive growth we're seeing in AI tech.
This firm's stock is trading at around $18 a share today...
But based on Keith's analysis, we could be looking at potential returns as high as 12,284%!
You can instantly access all the details right here.
Stay frosty,
Alexander Boulden
Editor, Wealth Daily
Check us out on YouTube!
After Alexander's passion for economics and investing drew him to one of the largest financial publishers in the world, where he rubbed elbows with former Chicago Board Options Exchange floor traders, Wall Street hedge fund managers, and International Monetary Fund analysts, he decided to take up the pen and guide others through this new age of investing.
Alexander is the investment director of Insider Stakeout — a weekly investment advisory service dedicated to tracking the smartest money on the planet so that his readers can achieve life-altering, market-beating returns. He also serves at the managing editor for R.I.C.H. Report, a comprehensive service that uses the highest-quality investment research and strategies that guides its members in growing their wealth on top of preserving it.
Check out his editor's page here.
Want to hear more from Alexander? Sign up to receive emails directly from him ranging from market commentaries to opportunities that he has his eye on.
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