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The mainstream consensus regarding market is, simply, that they’re bad. Our last major catastrophe was the 2008 global financial crisis — and what a whopper that was! Retirees saw 50% of their portfolio evaporate almost overnight, and the underlying economy fell into a funk that we really haven’t recovered from. The labor market was also one of the primary victims of the crash as employers significantly scaled back their human resources.

So yeah — catastrophic market collapses are always occurrences to avoid prior to events running out of control. Once you’re in a panic, a desirable exit price from an open market order is definitely not guaranteed. In my opinion, it’s a better idea to sacrifice a small-term gain — which basically describes the S&P 500 — than to suffer a halving of one’s portfolio. A 10% opportunity cost can be made up relatively easily with smart strategies. A 50% loss? Not so much.

On the other hand, a market crash can be a wonderful opportunity, provided that you have protected yourself first. Once the panic subsides, an avalanche of stocks are available for the picking. When this happens, there is a tendency for bargain hunters to look for the “best deal” based purely on the price tag. But what I would encourage as a forward-looking idea is to consider value.

Discounted Blue Chips Are Coming

For example, let’s take Nike Inc. (NYSE:NKE) as an example. Nike has had an uncharacteristically rough year, with shares down 20% year-to-date. Furthermore, sales have declined for certain channels, leading some analysts to criticize its management for not putting up exciting products. Rival adidas AG (ADR)

(OTCMKTS:ADDYY), in contrast, has been killing it this year. Is Nike on the way down?

For the rest of this year, I don’t expect too much progress made for Nike. I think it’s reasonable to assume that this year is going to end up as a loss. But here’s the thing — NKE rarely hits consecutive annual losses. This is a company that has been publicly traded since 1980 and has incurred only one series of consecutive losses, in 1983 and 1984. Other than that, NKE rises strongly after a bum year like clockwork.

Based on this incredible history, selling NKE would be the last thing on my mind. The better idea, in my opinion, is to wait out the storm. Let the bears come in and do their damage. Panicked analysts will write their doom and gloom stories for the company, further encouraging the short position.

But at some point, the bleeding will stop. This is Nike, not some backyard operation. I would feel safe trusting a company with four decades of business experience over an analyst’s call any day. And with its proven ability to bounce back from trouble, I would view the potential selloff of NKE as a premium discounted buying opportunity.

I’m not suggesting that NKE is the only company to buy. What I am saying, however, is to consider the blue chips when the markets go awry. They are some of your best options in a discounted environment.

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