It has been a long and for many, very tough year in the stock market.  However, for some traders, this has been a very profitable year, It is my sense that most investors are only “long the market” and view their hedge against a downturn as diversification and allocating funds to “defensive stocks”.  Although this strategy can help offset some of the loss, when experiencing the melt down that occurred in 2008, the market does not discriminate as to which stocks it chooses to crush.  The market just hammers everything.

It is my experience that most traders are not comfortable “shorting” the market.  When a trader chooses not to take advantage of a market trend such as we have just experienced, it limits that traders’ ability to optimize the returns available.  There is an old saying in the stock market “The market goes up like an escalator and down like an elevator.”  That is so true.  Money can be made more rapidly in bear markets as opposed to bull markets.  It is not only prudent but smart to take what the market gives you.  The market is going to do what it wants to do.  Why not just follow it.  The street is littered with those traders who have been trying to pick a bottom.  It is not necessary to pick the bottom in order to be profitable.  In the meantime, had you just remained with the trend, you would have profited handsomely.  There are several ways to play the market short.  1) Short stock 2) Inverse ETFs 3) Options.  My suggestion is that you become familiar and comfortable with playing the market in all directions so that you can be consistently profitable regardless of the market conditions.

If you are interested in learning how to do that, I would encourage you to take the free lessons at www.marketamer.com.  Make it a happy and prosperous new year.  Robin

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