Editor’s note: This article was originally published on March 26, 2020 via Jeff Clark’s Delta Report.
Just about two years ago, I had an epiphany…
I glanced up at one of the televisions in my office and watched the ticker tape at the bottom of the screen. There was one stock that kept crossing the tape. It was a tiny, $3 stock, but it was up over $2 on the day.
In other words, this tiny stock was trading below $1 per share the previous day. And, it was up more than 200%.
“That’s interesting,” I thought to myself at the time.
The next day, I noticed another low-priced stock that was trading sharply higher. It was trading for about $2 per share the day before… and was crossing the tape above $4.
The longer I watched the ticker, the more I noticed how there were several low-priced stocks showing super-sized gains.
And I started thinking, “These tiny stocks are showing option-like returns.”
Now… I’ve spent my entire career trading options. I love it. I’m pretty good at it. And, for traders who are looking to reduce risk and increase their potential reward, options offer the best way to do that.
After all, when you’re looking at trading stocks that trade for $50, $80, $100 per share and more, options allow you to capture all of the upside of a stock’s move while significantly reducing the downside.
The problem, though, is that options expire. If the stock doesn’t move in your direction by that expiration date, you’re going to suffer a loss on the option.
But stocks don’t expire. So, with these low-priced stocks, we get the potential for option-sized returns without the risk of an expiration date.
That was my epiphany. And, I got to work right away trying to figure out if there was something similar to all these tiny stocks that were popping like popcorn.
There is – and, I created a trading system to take advantage of it.
In the 18 months that followed my epiphany, I started trading these low-priced stocks with my own money. And, the gains were insane – as in, 100% in two months, 95% in three months, 56% in nine days, 55% in two days, 133% in less than three months, and so many more.
And in the time that I’ve shared my system with subscribers, I’ve handed them the opportunity to make gains of 101% in just over a month… and 127% in just a couple of weeks.
Like I said, these are option-like gains, in short timeframes… from low-priced stocks.
And, based on what I’ve seen since my epiphany, I’m confident that over the next year I can find at least 12 opportunities that produce gains of 100% or more.
I’ve started calling these “Flip Trades,” because you can take a position… flip it in a number of days or weeks… and potentially double your money, or more.
In an environment like we’re seeing now, with the stock market regularly making 3%+ moves each day, investors are more uncertain than they’ve been in years.
That’s when a trading system like what I’ve developed becomes highly valuable.
For a full rundown of how my trading system works, and to learn how you can access my latest Flip Trade idea, click right here.
Best regards and good trading,
P.S. Before we get to our mailbag, I wanted to give a quick message to members of Jeff Clark Trader and Jeff Clark Alliance…
After the markets closed on Tuesday afternoon, I sat down with my managing editor Mike Merson and fielded questions from subscribers. It was a ton of fun… and I opened up on some unique trading insights I haven’t yet written about.
If you’re a subscriber, and you haven’t seen it yet, you should take some time to check it out. Jeff Clark Alliance members can find it right here. And Jeff Clark Trader subscribers can watch it here…
Today in the mailbag, we’re sharing your replies to Monday’s Market Minute issue on the coronavirus pandemic…
But first, a winning trade result from Alliance member Michael…
Dumb luck or what? I missed Jeff’s message in Delta Direct on March 18 to close the TBT April 20 Calls for a “modest profit.” A few hours later that day, I saw the message and saw I had a 120% gain.
I was getting ready to sell, but it kept climbing, and finally exited the trade with a 201% gain. Nice to have some St. Paddy luck amid all the carnage elsewhere in the trading account. And thanks to Jeff for putting us in the position to have some luck once in a while.
Read on for our subscriber’s thoughts on the COVID-19 pandemic…
By the time a national emergency was called for the swine flu, 1,000 people were already dead. That number would climb dramatically. That worldwide pandemic never made much news.
At work, we received instructions on how to wash our hands, and were told to avoid people with the flu symptoms. It’s a much higher risk for the elderly, or those with existing health issues.
What is a life worth? If we ask those with families from the nursing home in Washington state, that would likely be an offensive question. If we ask the young couple with two kids and their first home – who are now both out of work and none would ever show more than mild, or possibly moderate symptoms – about the value of the government’s actions, we might get a different answer.
Jeff, in addition to the first question you asked is a second, and perhaps equally important one, which is, “STAY HOME for how long?” Personally, I see no end in sight for this lunacy. Let me explain.
If my family and I STAY HOME for two or three weeks, what then? Are we good to go after that? The answer of course is NO, because others have not stayed home for that exact period of time. Thus the STAY HOME order is essentially meaningless, UNLESS our overlords were to sequester every single American in their homes for 30 days at the exact same time!
Of course, very few people are prepared to remain inside their homes for 30 days at a clip. I can foresee this situation lasting far longer than what the USG is saying, and the economic damage could be catastrophic as a result. Just my thoughts. Thanks so much for all you do.
I wonder how many people will die because of the stress caused by being alone and/or lonely (especially for older people), the lack of income and more people having to choose between food and medicine, the shutdown of small businesses from which we may never recover, and the intense emotional spiral it will cause in people who risked their homes, retirement savings, and potential earnings to start their own enterprises.
Finally, and related to the final point above, will entrepreneurship as we know it cease? There is more to this pandemic than health implications.
The economic shutdown, and the very likely resulting serious depression, will cause far more serious consequences and deaths than whatever the total deaths resulting from COVID-19.
Do not mandate business closures. Develop guidelines to remain open. Have the government take over motels and hotels (PAY THEM OF COURSE) to provide final resting and isolation for the known terminal.
This will provide needed hospital care for those more likely to survive! Curtail mail and package delivery!
What’s really scary, Jeff, is that the most ignorant, incompetent President in the history of this nation apparently heard someone on Fox News say, “Is the cure worse than the disease?” and then, as he so often does, came up with his “very stable genius” tweet, demonstrating just how ignorant and incompetent he is.
We certainly don’t want to listen to someone who actually knows what he’s talking about, like Dr. Anthony Fauci, or the Surgeon General’s remarks about how bad this week is going to be, when Trump is available to dazzle us with his inane comments.
Dear Jeff, I do not think staying home will help too much. If you quarantine the active population instead of the most endangered part of the population, you destroy the system which could defend the older people.
In the end, everybody will suffer considering the uncertain outcomes of the quarantine. By the way, no one really knows what happened in China. It would be better to find a Western way of solving this problem rather than trying to copy the unclear solution of the country of origin. By the way, is it really solved there?
Jeff, deaths from regular influenza annually exceed 25,000 to 50,000 in the U.S. It would appear COVID-19 is not even a real contender for the championship belt.
This is yet another government intrusion into its citizens lives. A PERFECT example of how the
MEDIA controls its citizen puppets. Smoke and mirrors gentlemen, keep your eyes on the magician’s hands at all times!
Let’s hope the medical team advising our government are correct? Even if they are, the government needs to end this shutdown of the economy and let people go back to work sooner rather than later.
If they ruin the economy, that will cause more suffering than the virus. Trump won’t get re-elected and
Uncle Joe will be much worse than the coronavirus. GOD help us if that is what happens!
I don’t know if quarantine is helpful in the long run. But, I completely agree with the question you raised about whether the cure is worse than the disease!
As you brought to mind the words President Reagan called “the nine most terrifying words in the English language,” being, “I’m from the government, and I’m here to help”; I thought, that’s what we’re witnessing right now.
The government is wanting to throw so much money at this thing… yet where is that money going to come from? Good thoughts, sir.
YES! Good morning to you, Jeff! This is the first time I’ve given feedback. First, I like you and think you do your very best to help subscribers. I trust you. My worst enemy is myself! I’m 70 years old and have better hindsight than I’ve ever had.
Ronald Reagan’s quote is absolutely true. I could give several reasons, but you’re busy. So, this is my positive feedback! May you and your family be blessed with understanding, health span, and joy.
Thank you, as always, for your thoughtful comments. We look forward to reading them every day. Keep them coming at firstname.lastname@example.org.
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