Three steps for profiting maximally from the current market condition

You can see some March 12, 2020 newspaper headlines below:

• Wall Street dazed and confused after worst day since 1987
• Wall Street sell-off batters bitcoin, pounds palladium as investors go to cash
• Stocks Plunge 10% in Dow’s Worst Day Since 1987
• Stocks Plunge by the Most Since 1987
• Stock market live Thursday: Dow tanks 2,300 in worst day since Black Monday, S&P 500 bear market

The shocking headlines above say nothing about the volume of trading. Knowledgable investors pay attention to volume; most investors rarely check it. An increasing volume of trading, whether the markets are rising or falling, is a powerful indicator of the strength of the market move.

The average trading volume on the New York Stock Exchange is around 4 billion shares. Yesterday, March 12, 2020, the volume was more than double that! To find trading volume, you can do an internet search for “NYSE volume”. You can see the March 12, 2020 volume below.

Advancing           511,950,000

Declining        8,480,000,000

Unchanged                 499,389

Total                 8,992,449,389

These numbers strongly suggest that the decline will continue.

Yesterday’s blog talked about the effectiveness and the importance of rebalancing to our own asset allocation. L.D. Pankey, a student of Benjamin Graham’s, talked about rebalancing more aggressively for better results.