The Nasdaq is down more than 25% from its highs, demonstrating the carnage across the board in tech stocks. The S&P 500 has also begun to roll over, dropping nearly 20% from record highs. The Dow Jones Industrial Average has held up better but is still down a shocking 15%. The sky seems to be falling in the stock market, so what’s an investor or trader to do?
Fortunately, there are more options and alternatives out there beyond the traditional buy and hold method of making money off the stock market. Many such tools can be used to protect capital during downtrends and turn crashes into profits. Here is how you can protect your capital and profit from stock market madness using PrimeXBT.
Growing Risk Across Global Markets Elevates Volatility
To combat the onset of COVID and the impact of lockdowns on the economy, the United States Federal Reserve began expanding the monetary supply in cooperation with central banks and lowered interest rates, which helped to flood the market with capital. This capital made its way into the stock market, cryptocurrencies like Bitcoin, and other risk assets.
These assets exploded, bringing some of the best gains investors have seen in years. A sharp, V-shaped correction was all that was left behind post-COVID, then a parabolic rally that late last year came to an abrupt end. The very reasons that pumped markets are now the cause for its collapse. The Fed began tightening its monetary policy and raising interest rates for the first time in years. The result was an immediate selloff in anticipation of it all.
Making matters worse, the supply chain is still severely disrupted due to the pandemic, China remains in lockdown, war is waging across Europe, and United States inflation is the worst it has been in more than 40 years. Oil prices and other essential commodities are also skyrocketing. Investors fear the end of the growth cycle in stocks for the next several years or potentially more.
Stock Market Crash And Cryptocurrency Correction Explained
In response to the growing global turmoil and runaway inflation in the United States, the US stock market and its most popular stock indices have taken an extreme beating. No index has suffered worse than the Nasdaq, which represents a basket of top tech stocks from the sector.
The stock market also was brought down further by surrounding bearish sentiment related to the cryptocurrency industry, which was the target of a strategic attack of an algorithm stablecoin in an attempt to crash the market. The attack was a success, and cryptocurrencies, especially altcoins, were obliterated.
No cryptocurrency suffered worse than Terra LUNA, which fell from prices close to $100 per token to under a penny in less than a month. The attack also damaged the peg of stablecoin UST and took the price of Bitcoin to a low of $25,000 per coin.
How PrimeXBT Helps Traders Protect Capital And Profit
How is it possible to protect capital and even profit from the storm when such extraordinary volatility strikes? With the award-winning margin trading tools offered by PrimeXBT, anything is possible. Stop-loss protection would have triggered and prevented any unwanted severe drawdown. A short position could have possibly made the selloff profitable. PrimeXBT provides the complete flexibility of long and short positions using leverage, even simultaneously for hedge positions.
The platform has more than 100 different trading instruments listed, ranging from crypto to stock indices, commodities to forex, and more. All of the major US stock indices mentioned above, such as the Nasdaq, S&P 500, and Dow Jones Industrial Average are available to trade on the same platform as Bitcoin, Ethereum, and other altcoins. Gold, oil, and every other major asset is included.
Even PrimeXBT traders could have profited from the catastrophe in LUNA. As one of the many newer altcoins the platform has recently added, traders who were short LUNA had the opportunity to short it all the way down to zero. Investors in LUNA lost everything, while PrimeXBT traders raked in all the profit.
Prepare For Anything And Everything With PrimeXBT
PrimeXBT also provides other ways to help investors and traders survive markets when things get chaotic. Covesting copy trading lets followers copy the trades of other, more skilled strategy managers who prove their worth via a transparent leaderboard system. Covesting strategy managers have more than 5,000% ROI following the aftermath of the recent stock market and crypto crash, showing that it is very possible to protect capital and even profit substantially during downtrends.
Covesting yield accounts let crypto holders earn passive income through a variable APY on any idle crypto assets. APY rates reach as much as 14% during peak market conditions. This no-stress solution makes connecting to top DeFi platforms as simple as a click, right from within the PrimeXBT account dashboard.
While the damage has been done, it doesn’t need to be this way in the future. The next time volatility strikes, make sure you are registered for a platform that provides you with the tools above. PrimeXBT makes it possible to protect capital and stay profitable, even in the worst situations that markets have seen. Be prepared for anything and everything with PrimeXBT.