Young Research & Publishing Inc.

Investment Research Since 1978

Disclosure

  • About Us
    • Contributors
    • Archives
    • Dick Young’s Safe America
    • The Final Richard C. Young’s Intelligence Report
    • You’ve Read The Last Issue of Intelligence Report, Now What?
    • Dick Young’s Research Key: Anecdotal Evidence Gathering
    • Crisis at Vanguard
  • Investment Analysis
    • Bonds
    • Currencies and Gold
    • Dividend Investing
    • ETFs & Funds
    • Investment Strategy
    • Retirement Investing
    • Stocks
    • The Efficient Frontier
  • Investment Counsel
  • Dynamic Maximizers®
  • Retirement Compounders®
  • Free Email Signup

How to Survive a Stock Market Meltdown

October 7, 2019 By Dick Young

In recent quarters my goal has been to work especially hard at providing investors with intelligence that will keep them safe and dividend-centric during what I consider the inevitable coming stock market meltdown. Stock market meltdown? Absolutely baked into the cake as I write to you, and becoming more of a deep midterm concern for me as time passes. The Fed’s robbing Peter (you and Dick Young) to benefit Paul (international bankers and Wall Street charlatans) program has created the most distorted and manipulated investment environment in my over five decades in the business.

What Does a Stock Market Meltdown Look Like?

What does a stock market meltdown look like? Think back. What were you up to at the turn of the century? Feels like a long time ago, doesn’t it? Are you aware that during this period, the speculative NASDAQ (larded with non-dividend payers) endured four annual crashes of greater than 20%? And over 30% was knocked off the NASDAQ in three of these “take you out of the game” debacles. Moreover, the horrific 2008 collapse peeled 41% off the NASDAQ.

Remember, when you lose half your money in any period of time, you must double your money just to get back even.

A New Portfolio Concept to Survive a Stock Market Crash

In Intelligence Report, I have introduced a brand new portfolio concept to keep investors safe and dividend-centric during the next stock market crash. I have tweaked my original work on dividends and interest, along with my long-time interest in gold (I have held my original 1982 China Gold Pandas for decades), to produce what I call the “Dynamic Maximizers.”

What are the Dynamic Maximizers?

The DMs are a fine-tuned derivative of Young Research’s original Maximizers portfolio. On the stock side of the portfolio, I focus on high-barrier-to-entry businesses with lasting competitive advantages as well as firms with long records of paying and increasing dividends. On the bond side, I use a mix of Treasuries and investment-grade bonds whose weights vary depending on the opportunities and risks in the bond market. High-yielding dividend paying stocks hold up better during stock market crashes than non-dividend payers and historically high-grade intermediate-term bonds have risen during past stock market meltdowns.

The portfolio concept is simple and conservative, but as we all know too well, knowing how is simple, but actually having the discipline, intestinal fortitude, and patience to bring off a Maximizers compounding strategy is quite another matter.

Who should invest in the Dynamic Maximizers?

The DMs are ideal for retirement investors, IRAs, and education programs, to be used instead of fixed-income portfolios in periods of historically low and manipulated interest rates. Maximizers investors, should however, recognize going in that long dry spells of underperformance can be expected and are just part of the game with such a conservative approach.

What kind of performance should investors expect from the Dynamic Maximizers?

Past performance is no guarantee of future success, but I am proud to say that Young Research’s Dynamic Maximizers portfolio hasn’t suffered a single down year this century. Compare that, by example, to the NASDAQ Composite.

The display below tracks the performance of Young Research’s DMs versus the NASDAQ from year-end 1999. My conservative Dynamic Maximizers strategy beats the reach-for-return crowd by a country mile.

Slide3

Win the War, Not Every Battle

What is most shocking about this long-record of outperformance, is that the NASDAQ actually beat Young Research’s Dynamic Maximizers in 10 of the 16 years profiled. A 6-and-10 MLB starting pitcher record would get a player banished to the bullpen. My Maximizers strategy wins the war by a long shot and it does so with no down year. Furthermore, in 13 of the 16 full years this century, returns for my Dynamic Maximizers have fallen within a 3% to 10% range. For the outgunned NASDAQ, the deviation from best to worst year is a breathtaking 91 percentage points. And the bone-chilling NASDAQ record includes five down years, four of which were bruisers. No half-sensible retirement investor is going to sign on for that back-snapping volatility.

Remember my cardinal rule of portfolio crafting: “Always analyze risk before worrying about potential returns.”

I put risk ahead of return in my own portfolio and in the portfolios of members of my private client investment counsel firm. You can read more about the investment programs my firm offers and sign-up for our insightful client letter (free, even for non-clients) here.

 Originally posted October 14, 2016.

Share this:

  • Email
  • Twitter
  • Facebook

You Might Also Like:

  • A Record Breaking Stock-Market
  • How Expensive is the Stock Market?
  • A Safe Port in the Stock Market Storm
  • Author
  • Recent Posts
Dick Young
Richard C. Young is the editor of Young's World Money Forecast, and a contributing editor to both Richardcyoung.com and Youngresearch.com.
Latest posts by Dick Young (see all)
  • PRICES SOAR: Diesel Shortage Could Cripple America’s Economy - May 13, 2022
  • Young’s Retirement Compounders Clearly Dominate! - April 26, 2022
  • The Magic of Compound Interest - April 5, 2022

Search Young Research

Most Popular

  • Will the Fed Stick to Its Course?
  • RECESSION? Dow 25,000, $8 Gas, Rising Interest Rates, Spell Mid-term Crack Up
  • Investing During a Recession
  • Swiss National Bank Surprises World with Rate Hike
  • Kellogg Cuts Loose with Split Plan
  • The Power of a Compound Interest Table
  • MONEY TALKS: The Best Service in Paris
  • Predictions of MEGA-SPENDING on Metaverse
  • Apple Shares Resilient in the Face of Recession
  • Vanguard Wellesley (VWINX) vs. Wellington (VWELX): Which Fund is Best?

Don’t Miss

Default Risk Among the Many Concerns with Annuities

Risk and Reward: An Efficient Frontier

How to be a Billionaire: Proven Strategies from the Titans of Wealth

Could this Be the Vanguard GNMA Winning Edge?

Cryptocosm and Life After Google

Warning: Avoid Mutual Fund Year End Distributions

Is Gold a Good Long-term Investment?

How to Invest in Gold

Vanguard Wellington (VWELX): The Original Balanced Fund

What is the Best Gold ETF for Investing and Trading?

Procter & Gamble (PG) Stock: The Only True Dividend King

The Dividend King of the North

You’ll Love This if You’re Dreaming of an Active Retirement Life

RSS The Latest at Richardcyoung.com

  • Greetings From Paris & Le Bristol Hotel
  • The Most Controversial Restaurant in Paris?
  • Your Survival Guy: Clearing the Decks, Buying a Boat, Seeing the World and More
  • Russia’s “Unsubtle” Artillery Attacks Not Necessarily “Archaic”
  • FLORIDA DODGED A BULLET: Elected Superb DeSantis Over Unstable Gillum
  • Biden, a Job Killing Machine
  • Good News for the 2nd Amendment
  • La Fontaine De Mars: Best Sunday Paris Lunch
  • My 10 Favorite Books about France, Plus a Bonus for You
  • BREAKING: Supreme Court DISMANTLES New York’s Unconstitutional Gun Laws

About Us

  • About Young Research
  • Archives
  • Contributors

Our Partners

  • Richard C. Young & Co.
  • Richardcyoung.com

Copyright © 2022 | Terms & Conditions

 

Loading Comments...
 

    loading Cancel
    Post was not sent - check your email addresses!
    Email check failed, please try again
    Sorry, your blog cannot share posts by email.