In a moment, I am going to tell you how to take advantage of
one of best investments for the foreseeable future. But first I
want to you to take heed to what I am about to tell you.
When the stock market rises as fast as it has, you owe it to
yourself to take precautions. No market rises forever. So today
I'm going to tell you a way to protect yourself from the
likelihood that this market won't keep rising indefinitely.
But first, some context …
The Standard & Poor's 500 Index (
) is up 16.8%. That's the best start to a year since 1987, when
it rose 18.7% during the comparable period. Later that year on
, the Dow lost 508 points, or 22.6%, in the historic crash known
as Black Monday.
Moreover, it's been 184 days since a daily 5% pullback in the
S&P 500. The return for the market benchmark during this
overwhelmingly bullish six months is 22.3%.
But it was the latest three-week spike higher in SPY made me
realize the journey higher was nearly complete.
Roughly three weeks ago, SPY was trading for $153. Since that
short time, the index has managed to tack on 8%. That's pretty
remarkable, considering the historical annual average return for
SPY is approximately 8% a year.
The historic move has had a side-effect as well. It's impacted
the success of high-probability credit spreads over the past
But before I get to the side-effect let me give you a brief
insight into one of my favorite investment strategies. Other than
selling puts, credit spreads offer the highest-probability
strategy in the investment world. We're talking about making
investments with an 85% chance of success. Credit spread
strategies are THE choice amongst professional investors,
particularly professional options traders. The strategy allows
you to make money in a up, down or sideways market in less than
45 days. As a result, it is one of the best ways to bring in
monthly income and why I use the strategy, among others, in my
Options Advantage service.
Unfortunately, we have been in one of weakest periods for
credit spreads over the past 30 years. A sharply trending market
coupled with historically low volatility is the one extreme
credit spreads have a hard time handling. However, the most
profitable periods have followed these weak periods…and I expect
to see history repeat itself once agin this year.
Fortunately, this historic period is an anomaly, so the chance
(or probability as I like to say) of the upward trend continuing
is low. Unfortunately, it's the anomalies that are a detriment to
high-probability credit spread strategies.
But as we all know, it's the weak periods that lead to
This leads me to the investment I mentioned at the beginning
of the article. I recently put together a webinar on what I call
The 77% Income Trade
". Within the presentation I discuss the strategies I use to
bring in income on a monthly basis. But more importantly, I give
away two actionable investments that should do well over the next
Also, if you haven't had a chance sign-up for my free weekly
The Strike Price
….and if you want to know what I am thinking on a daily basis
check out my
If you would like to learn more about options and how you
can generate steady income month in and month out... then
consider taking a free, 30-day trial to our real money alert
service, Options Advantage. You'll discover exactly how
our resident options expert, Andy Crowder, is using high
probability trades to steadily grow a $25,000 real money
portfolio. Every trade is executed for real... and readers are
alerted instantly, so they can invest right alongside
Click here to try Options Advantage,