The Coronavirus has swept the world, with country after country going into full lockdown, closing borders, halting travel, shutting businesses, and telling people to stay indoors.
Stocks have already fallen faster than they did during the 2008 Global Financial Crisis, while central banks and governments – slow to respond – are now flooding the market with trillions in stimulus “money.”
Here’s what you can to do right now to protect you retirement and your family's wealth…
Step One: Sell the Losers
The Coronavirus outbreak is pushing down stocks all over the world, and the “recovery” we've seen so far looks like a dead cat bounce.
This isn't over.
Even as China gets over its part of the outbreak, the near-complete shutdown of travel and factories across large parts of the country has sent China’s economy into a standstill.
Related: Why This Crisis Could Last 18 Months
This is coming straight from a former CIA and Pentagon advisor…
Click here to get the details on how you can protect yourself and see why the government is planning for the worst… an 18-month crisis.
Meanwhile, businesses in the U.S. ranging from car companies to smartphone makers and pharmaceuticals are all warning that delayed shipments from China are hurting their bottom lines.
As people across the world begin hoarding food and basic supplies and cut down on their spending in fear, international travel and trade are grinding to a halt.
Even the Fed cutting interest rates by half a percentage point in an emergency announcement on March 3, and the $2 trillion in stimulus money, may not support the markets for long.
There’s no stopping this correction, at least not for now.
So to protect your investments you need to get out of the way of the panic.
In other words, sell the stocks and ETFs that will be dead weight in the coming weeks:
Dead Weight #1 – JETS, BA, and EADSY
Airlines and Aircraft Makers
With country after country restricting or outright banning travel to countries affected by the coronavirus epidemic, airlines are being forced to cancel flights months out.
Countries around the world have already banned airlines from flying to China and South Korea. And now that the outbreak in China seems to be slowing down, China has begun banning people from other countries, to stop the Coronavirus from reentering the country.
In short, airlines are being hit left and right, and it will be at least months before they recover.
So make sure you sell U.S. Global Jets ETF (JETS), an ETF that tracks the performance of U.S. and international airlines, aircraft makes, airport companies, and other air travel businesses.
This includes companies such as Southwest Airlines Co. (LUV), American Airlines Group Inc. (AAL), Delta Air Lines Inc. (DAL), United Airlines Holdings Inc. (UAL), and others. If your portfolio includes any of these, sell them.
Also sell your shares of The Boeing Co. (BA) and Airbus SE (EADSY), the two leading aircraft manufacturers in the world. Both were struggling even before the Coronavirus outbreak. Now that airlines will suffer, there will be no one to buy Boeing’s and Airbus’ new airplanes.
Editor’s Note: For a more speculative play, consider buying puts on JETS or these airline stocks. This carries much higher risk but comes with the potential to make money as their share prices fall.
As you can see, the airline industry is falling much like General Electric Co. (GE) once did.
No one believed Porter Stansberry when he said GM would fall apart… or that the same would happen to General Growth Properties (America's biggest mall owner)… or that oil would fall from over $100 per barrel to less than $30 a barrel.
No one believed him years ago when he said the world's largest mortgage bankers (Fannie Mae and Freddie Mac) would soon go bankrupt.
But in each case, that's exactly what happened.
And now, Stansberry says something new and even bigger is quietly unfolding in America (watch his video clip here):
In short: A terrifying new trend is creating thousands of new millionaires (Barron's estimates 20,000 to 200,000 so far) while at the same time destroying the financial future for many others.
Stansberry says this new trend is going to cause tens of millions of people to lose their jobs… it will also cause many major bankruptcies… yet at the same time it will make millions of others, incredibly rich.
Don't get left behind. Get the facts for yourself here.
Dead Weight #2 – LVS and WYNN
Casinos and Entertainment
Coronavirus outbreaks are popping up all over the world, with countries on every inhabited continent now affected.
Travel is restricted, people are afraid of being infected, and with a falling stock market, consumer spending is down.
That’s horrible news for casinos, which survive only on tourists with lots of money to spend. In Macau, China’s gambling center and the world’s largest casino hub, casinos even had to shut down for two weeks to prevent spread of the coronavirus.
The results were disastrous. In late January 2020, Macau’s tourism office reported an 80% drop in Chinese tourists compared to the year before. A month later, the city’s casino’s announced an 87.8% fall in gambling revenue, much worse than analysts had expected.
But that’s just Macau. The real impact of the coronavirus epidemic has yet to hit other gambling centers, such as Las Vegas.
That’s why you should sell any casino stocks you own, especially Las Vegas Sands Corp. (LVS) and Wynn Resorts Ltd. (WYNN). With travel and tourism plummeting all over the world, all their casinos will suffer, no matter where they are.
Editor’s Note: For a more speculative play, consider buying puts on LVS and WYNN. This carries much higher risk but comes with the potential to make money as their share prices fall.
Step Two: Buy These Winners
Luckily for investors, there’s more to the coronavirus panic than just losses. There are also some opportunities to grow your nest egg even as the markets panic:
Profit Play #1 – SDIV and PFF
Dividend Stocks That Will Keep Paying
When markets are in a rout like today, the share prices of companies naturally fall. But their dividends stay the same.
In other words, you now have the opportunity to get more dividends for each dollar you invest.
The Global X SuperDividend ETF (SDIV) is one example. This ETF invests in 100 of the companies around the world that are stable and liquid, and have the highest dividend yields.
Right now, the SDIV pays out a dividend of 9.49% – a record high for the ETF, and much more than this panicked market is likely to give even the best investor.
Another option is to invest in preferred shares. A preferred share is a kind of stock, but it generally pays a much higher dividend, but has a more stable price.
Preferred shares generally suffer when interest rates go up. As interest rates climb, yields on bonds, and so investors buy bonds and abandon preferred shares.
But with the Fed’s emergency cut to interest rates, and with the economic pain likely to continue for months, interest rates are likely to stay low for long. They may even go down further.
The best way to invest in preferred shares is the iShares Preferred & Income Securities ETF (PFF). The ETF, which has a good history of returns, currently yields 5.24%, and should generally be more stable than most stocks.
Of course, none of these dividends compare to the revenue generated by Amazon.com Inc. (AMZN).
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Profit Play #2 – GLD and JNUG
Gold is Going Up as Panic Spreads
Gold has long been a safe haven for investors looking to escape turmoil, panic, and threat of inflation.
This coronavirus scare is no exception.
As Fed Chairman Powell announced the emergency interest rate cut on March 3, gold jumped by 3%, more than it had move up in four years.
With the global market rout continuing, gold's stability will continue to draw investors. The simplest way to invest in gold is the SPDR Gold Shares (GLD) ETF, which reflects changes in the price of gold.
A faster moving, but also somewhat riskier, strategy is to invest in junior gold miners. These speculative companies are often still prospecting for gold, or have only just begun mining it.
As such, they are less of a known entity – and swing up and down much faster than the price of gold.
The most speculative play on junior gold miners is Direxion Daily Junior Gold Miners Index Bull 3X Shares (JNUG). This ETF moves three times as fast as the already fast-moving junior gold miners do, potentially turbocharging wins on gold. However, JNUG will also amplify any losses by three times.
Editor’s Note: For a more speculative play, consider buying calls on GLD and JNUG. This carries much higher risk but comes with the potential to make money faster when their share prices rise, compared to buying the stock.
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Profit Play #3 – CVS and CLX
Stocks That Will Make Money Throughout This Crisis
Most people who catch the new Coronavirus don’t need to go to the hospital. But even mild symptoms will require painkillers and tissues. And as everyone is panicking, the sales of disinfectants, hand sanitizers, and so on are rising.
That’s why even amid this market rout, pharmacy chain CVS Health Corp. (CVS) and disinfectant brand The Clorox Co. (CLX). CVS is already the leading drugstore in the U.S., with profits and revenues expected to grow for years on the back of its HealthHUB initiative.
This plan turns pharmacies into urgent care clinics open on nights and weekends, where some minor illnesses and chronic conditions can be managed. These clinics may also see increased revenues once the coronavirus outbreak spreads here in the U.S. in earnest.
The success of HealthHUBs made 2019 a great year for CVS, and once the market rout is over, it will continue to do so.
Clorox, meanwhile, has held up better than most stocks in the first two months of 2020, as traders expect an increase in sales of the company’s trusted disinfectants. Once that shows up in the company’s numbers, the stock will soar.
Editor’s Note: For a more speculative play, consider buying calls on CVS and CLX. This carries much higher risk but comes with the potential to make money faster when their share prices rise, compared to buying the stock.
Profit Play #4 – AAPL, MSFT, and NFLX
Huge Winners at a Discount
A market panic is also a great opportunity to buy already amazing stocks at a discount. Take Apple Inc. (AAPL), for example. The Silicon Valley tech giant is down from its all-time highs because of concerns about the company’s suppliers in China being behind schedule.
But in the long term, once this coronavirus scare blows over, Apple is most likely going to resume its long-running streak of successes. The next iPhone will come out, will most likely sell well, and Apple’s cloud services will continue to bring in revenue.
This market correction could be an opportunity to buy long-standing market winners at a discount. So look at adding Apple, Microsoft Corp. (MSFT), and Netflix Inc. (NFLX) to your portfolio at today’s low prices.
Now, all of these tech companies have been riding on the upcoming 5G wireless revolution.
And now, a groundbreaking new technology is expected to be in every household in America by the end of this year… This technology has the potential to make over 266 million smartphones become obsolete, forcing nearly every American to switch over to this new “5G Device”. Learn more about it in this video.
