Founder, Masters in Trading
Editor’s Note: My colleague Jeff Clark is one of the best options traders I know. And just like me, his strategy is all about finding those big winners wherever the markets move.
If you don’t follow Jeff’s Delta Direct – his service that comes straight from him, to the subscriber – no editor or middleman – you’re missing out.
Jeff has managed an incredible track record over the last year that shows just how profitable trading options can be in the face of significant volatility. Ever since April 2 “Liberation Day,” Jeff has closed 25 trades, including…
- 19 winners
- 15 double-digit gains
- And a whopping 3 triple-digit gains
Eleven of those 19 winners since April 2 came straight out of Delta Direct — Jeff’s flagship trading newsletter.
Every trading day, Jeff breaks down the markets… provides updates on big market events… and drops his quick hit trades in there.
And right now, we’re unlocking his insights to anyone who’s interested in getting a leg up on market volatility.
I want to give anyone who’s interested the chance to sign up as soon as possible. Jeff’s insights are the best in the game — and in a market this chaotic, his system is helping so many readers keep their capital at work.
How to Trade Chaos: 19 Winners in Two Months
By Jeff Clark — Founder, Delta Direct
A “rubber band” has snapped back…
One way to profit in a bear market is by betting on the rubber band snapping back.
That’s how master trader Jeff Clark describes his core trading strategy.
If you stretch a rubber band too far in one direction, it snaps back. That’s what happens in markets, too. If an asset’s price goes too far away from its average – in either direction – it snaps back.
And we just saw the rubber band in action in the S&P…
“Liberation Day’s” Flash Crash
On April 1, the S&P closed at 5633. On April 7, it closed at 5062.
But while everyone was panicking over tariffs… Jeff had been pounding the table since President Trump’s inauguration, warning his readers of a period of volatility… and how he was excited to trade it.
While buy-and-hold investors have gone nowhere from inauguration day, January 20 – when the S&P 500 was trading near 5960 – to June 2 when the S&P was trading at 5935…
Jeff has put 19 winning trades in… just since April 2. Of those 19 winners, 11 of them were double-digit winners.
And as you’ll see today, he’s been using this strategy based on the rubber band effect in chaotic markets for decades.
So let’s take a closer look at how this works. And why it’s been such a powerful strategy during the recent market turmoil.
First, an important warning…
Most traders talk in jargon…
So, they can be hard to follow – especially if you’ve just started your wealth-building journey.
That’s what I love about Jeff. He keeps it simple.
That’s where the “rubber band” comes into play. A simple way to grasp how stocks move over the short term, is by picturing a rubber band. Jeff says…
My trading strategy revolves around finding emotionally overbought and oversold conditions that are ready to reverse – or snap back.
Think of those conditions as a stretched rubber band. We can all tell when a rubber band has been stretched close to the limit. The rubber at the center of the band stretches thin. Its color fades. It even starts to vibrate just a bit. That’s usually when it snaps back.
The same goes for the stock market. Back to Jeff…
When you’re trading stocks, it’s harder to tell when the snapback is coming. But there are clues…
Stock prices stray far away from their long-term averages. The technical indicators I watch on the charts reach extreme conditions. And TV’s talking heads all pile onto the same side. That’s when the logical-thinking trader decides it’s time to bet on the rubber band snapping back.
That doesn’t mean every trade Jeff recommends is a winner. But the rubber band effect puts the odds in his favor.
That’s why Jeff has had some of his best years as a trader when stocks were in a bear market.
During bear markets, volatility tends to spike…
The snapbacks from overbought and oversold conditions tend to be even more dramatic than in bull markets. This amplifies the potential gains traders can make.
It’s what allowed Jeff to nearly double his net worth during the dot-com collapse – with a single trade.
And during the 2007–2009 bear market, he handed his subscribers the chance to make transformative wealth.
At the time, Jeff helmed a trading advisory called The S&A Short Report for newsletter industry legend Porter Stanberry. Here’s what Porter wrote about Jeff’s track record on January 29, 2009…
Jeff’s trading this year in The S&A Short Report was nothing short of heroic. He made 52 recommendations – all of them short-term trades. Out of these, 42 made money. A win rate of more than 80% in options trading is ridiculous. The average return of every trade was a bit more than 31%.
That’s outrageous when you understand the short duration of these trades and the turnover in the portfolio. How outrageous? The cumulative total return was greater than 1,700%.
You may think trading a bear market is risky…
I get that. A lot of rookie traders blow up their accounts due to risky bets.
But Jeff has been a professional trader for more than 40 years.
And as he’s been spreading the word in the 20 years since he launched his first trading advisory, you can use options contracts to reduce your risk of losses.
Think of options contracts as side bets on stocks.
You don’t have to own the stock itself to profit when it moves. You can buy a call option on that stock if you want to profit as its price rises. And you can buy a put option on a stock if you want to profit as it falls in price.
And you risk less money to control a stock in the options market than you do buying it directly. As Jeff explains it…
Let’s say you want to buy stock in Company X. It trades for $10 a share. So, you could spend $1,000 to buy 100 shares.
But you can control the same number of shares with one call option contract. You can buy that call for, let’s say, $50… and leave the other $950 in your account.
If Company X’s stock goes up, you’ll make money. If the stock goes down, the most you can lose is the $50 you spent to buy the call. That’s a 100% loss. But it’s a lot less in dollar terms than losing, say, 20% of the $1,000 you risked buying the stock. That would set you back $200.
That makes options a low-risk, high-reward way to trade the volatility that kicks up in bear markets.
Jeff sees even more volatility ahead…
He said recently:
The second stage of this bear market will be brutal.
Of course, most folks are skeptical we’re even in a bear market. That’s understandable.
After all, the S&P 500 has recovered nearly everything it lost during the February-April decline. The index is within spitting distance of a new all-time high. So we can’t blame anyone for thinking stocks can only go up from here.
Except… We know this is what bear markets do. The first rally phase in a bear market is designed to punish bearish traders who’ve held on to short positions for too long, and then coax reluctant bulls back into the market.
We don’t have to go too far back in time to find evidence of this action. Think about the bear market that occurred in 2022. Here’s the chart of the S&P 500 from back then…
The S&P 500 peaked in early January 2022. It then suffered its first decline phase – falling 16% in two months.
We then got a stunning, “V” shaped rally. The S&P recovered most of its first phase decline.
V-shaped rallies are dangerous. Investors who sold at the bottom regret their decision. They buy back in at higher prices. And, this time, they vow not to get “bluffed” out of positions on the next decline because apparently, stocks only go up.
During the second decline phase, these investors hold onto their stocks and endure larger losses because they’re convinced they made a mistake selling the first time around.
It happened in 2022. And it’s about to happen in 2025 as well.
But again… Jeff isn’t worried about this.
And if you sign up for VIP alerts, you’ll get access to his Delta Direct service.
He’s never unlocked this benefit before… It’s Jeff’s direct-to-subscriber “squawk box” – no middleman or editor touches his words before they get to you.
Each trading day from now until June 12, Jeff will give you a morning update… and updates on the moves the market is making throughout the day.
Jeff also gives his quick hit trades there. For example, out of the 19 winning trades since April 2, 11 of them came from Delta Direct. And you can access it for free by signing up for VIP alerts right here…
In the mailbag: “Thanks for helping us take our finances into our own hands”…
As I said above, the rubber band effect amplifies the potential gains traders can make. It makes volatile markets a trader’s dream.
But Jeff also knows that when markets get as volatile as they are right now, trading requires a more deliberate method… or else you risk blowing up your account on risky trades.
It’s something his readers recognize. And they’ve written in their appreciation for his calculated approach to his trades…
I just want to tell Jeff how much I appreciate his measured approach to trading, i.e., not feeling compelled to publish a trade, if it’s being posted on a wing and a prayer. I’m happy to read his thoughtful summaries of why there are days it’s fine to sit on the sidelines.
– Laura H.
Love the simplicity and clarity in the way you teach, I appreciate the way you lay it all out and encourage us to get going. I also appreciate the logical way you present information and the rationale behind the decisions and when it is best to use the strategy that you are suggesting.
Thanks for doing what you do to help us out, gain some confidence, and take our finances into our own hands.
– Paula M.