'The stock market is not going to zero': How this individual investor with 70 years of experience is trading the bear market

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Growing up in a poor family, this 85-year-old investor has built a comfortable life for himself and his family — by sticking to four straightforward stock-market strategies through bull and bear markets.

Not many investors can claim a lifetime of stock-market success. Warren Buffett of Berkshire Hathaway BRK.A, +0.07% BRK.B, +0.04% comes to mind, of course, but what about Warren Kaplan?

Before buying a single share, Kaplan first looks at the stock’s P/E ratio, dividend, and dividend history. “I want a company that is truly committed to raising their dividends,” he says. “I don’t care about the last three years, but if the company raises its dividend for a number of years, that means something to me. That is a stock I will put on my watch list. You have to be patient and wait to buy at a price that represents good value.

3: Buy and hold : Unlike many investors who buy and hold indefinitely, Kaplan holds stocks until the market environment changes. That catalyst could be a change in management, a dividend cut, technical weakness, poor earnings or overvaluation. If any of these scenarios occur, Kaplan may reduce his holdings or sell all of his shares. .

Kaplan summarizes: “I may start by buying six shares of an Aristocrat stock, and if it goes lower, I may buy another eight or nine shares. Once I accumulate 100 shares, I sell covered calls options on it. I use the options market to sell. It eliminates selling anxiety.” How to handle bear markets Kaplan likes falling markets — including bear markets. This gives him the chance to buy his favorite stocks at bargain prices. “I look forward to a bear market,” he says. “I will enter a Good til Cancelled order on stocks that I want to buy at lower prices. For example, I may buy 10-, 15- or 20 shares, depending on the stock price.”

 

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