Take this One Step to Prepare for the Coming Correction

By Matthew Milner, on Wednesday, July 31, 2019

The threats are everywhere:

The trade war with China. A slowing global economy. Geopolitical hazards from North Korea and Iran.

Despite these threats, the Dow, S&P 500, and Nasdaq find themselves in record territory.

But this disconnect won’t last. Essentially, a crash is inevitable. And when it comes, retirement accounts will get destroyed. As The New York Times wrote, “Investors should be worried.”

So today, I’ll explain three things:

Why the markets have kept rising in the face of these threats…

Why they’ll inevitably crash…

And how one simple strategy can help protect your hard-earned money.

“There Is No Alternative”

The Federal Reserve is hosting an important meeting today.

Many expect it to lower interest rates.

Interest rates are very low already. For example, the 30-year Treasury bond yields just 2.5%.

After inflation, that puts its returns at about 0% — a highly unattractive proposition. And if rates go any lower, it will become even less attractive.

So, where are investors putting their money instead? Stocks! That explains why the market keeps going up:

With nowhere else to go to make a return, people keep pouring money into the market — and that makes prices keep rising.

But now I’ll share an alternative investing strategy with you. And the best part is:

It Has Nothing To Do with the Stock Market

Eventually, one or more of the threats I mentioned above will come to fruition:

Maybe the trade war with China becomes too much for local manufacturers… maybe tensions with Iran escalate into true conflict.

The market is already on thin ice. An event like that could cause it to crack — and could cause the market to crash. That’s why, if you care about protecting your money (and your retirement), you need to do two things:

  1. Put some of your money into assets that aren’t “correlated” to the stock market — in other words, invest in assets that “zig” when the stock market “zags.”
  2. Put some of your money into assets that can generate far higher returns than stocks.

As long-time Crowdability readers know, there’s only one place where you can reliably earn gains that are both large and uncorrelated to the stock market:

The private markets.

Your #1 “Alternative Investment”

For example, research has shown that a diversified portfolio of private startups can return up to 55% per year.

Which means, even if you allocated just a tiny portion of your nest egg to this asset class, you could dramatically increase your overall returns.

In fact, according to a CNBC report, adding startups to your portfolio gives you “an easy way to nearly double the equity return that your 401(k) is generating.”

And again, the private markets aren’t “correlated” to the stock market — so when the inevitable crash comes, your money and your retirement will be protected.

As global investment manager BlackRock reports, “Investing in private companies offers the potential for enhanced diversification and returns, since the factors driving these markets differ from those that drive public equity markets.”

Don’t Delay Any Longer

Allocating a small piece of your portfolio to startups can help you decrease your risk, and at the same time, it can help you dramatically increase your returns.

If you haven’t dipped your toe into this market yet, don’t delay any longer. Now’s the time to start educating yourself on private market investing — and we’re here to help:

You can start by reviewing all the educational materials we have in the free Resources section of our site »

And then, once you’re ready to get serious, you can enroll in our premium education course, our “stock screener” for private companies, or our private-market research service »

Happy Investing!

Best Regards,



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Tags: Federal reserve Recession

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