We all get a lot of email from analysts and economists fretting about a “crash.” Are we in the early stages of one now? Will it wipe out investment accounts and investor confidence for a generation? Here’s my take on all that.

My career started in the 1987 crash. I know what it feels like to see markets around the world crumble simultaneously. This is not that. When the Dow is down 3% from its all-time peak and the S&P 500 is down 4.5%, nobody who has actually lived through a Wall Street meltdown is seeing a lot of parallels.

Yes, the Dow is only down 3%. People are talking like it’s the end of the world because the handful of stocks they know best have taken a huge lurch to the downside . . . and those stocks just aren’t what drives the old-school Dow or even the S&P 500.

The “Magnificent 7” are the pain point. They’re all down 7-27% from their peak. Factor them out of the S&P 500 and the market is actually UP. People who are overweight the other 493 biggest U.S. companies aren’t exactly running for the exits.

But sometimes a catastrophic loss happens. What Black Monday taught me all those years ago is that you can’t hide out forever trying to avoid a crash. Do that and you’ll never be in a place where you can hit the ball out of the park . . . you’ll be harder pressed trying to shield what you have from inflation.

Granted, if a crash hits you wrong footed, you can lose everything you had in the market, which makes it impossible to recover. I saw that happen to a lot of people in 1987 and I’ve seen it a lot in the intervening decades.

Here’s how to have it both ways: never commit everything. Keep enough “dry powder” in your account to give yourself a cushion from the inevitable crash. Think of it as an airbag built into your car. It inflates and you get a chance to walk away and drive again.

This is how classical hedge funds work. The “hedge” refers to investments that inflate when everything else is crashing. That’s how they provide elite investors with something like a reliable return across all market conditions.

We do something simpler in my options-driven trading systems. As you probably know, options are extremely volatile. Potential returns can swing wildly from positive to negative and back again in minutes.

One of the few constants in that market is that when a contract expires, you need to exercise it or let it vanish. Sometimes the best scenario is that your puts or calls vanish at a net value of zero, taking your entire investment with them. (It can actually get worse!)

Something like that happened to my 2-Day Traders recently. It can happen to any options trader, despite all good intentions and safeguards. That’s just how fast these instruments can move as the expiration clock starts ticking.

We were holding XLU puts that would make money if utility stocks broke down. I didn’t see any reason for those stocks to be as strong as they have been. I still don’t. However, the breakdown never came.

(The irony shouldn’t be lost on you. We were betting on a crash. A crash didn’t happen!)

We sold those puts hours before they would have expired worthless. It stung. Someone who gambled all their cash on every trade would have effectively gone bust, with no easy way to recover.

That’s why I’ve been urging my people to only trade 50% of their starting account balance on every position. Let the rest work in safer and more liquid areas of the market.

We had a few people who joined 2-Day Trader that day. Without the cash reserve, that would’ve been a dismal experience!

But because they had dry powder, they got back in the game. Our next trade earned 43% . . . not a bad start, closing half the gap in a single week. We transferred that profit back to refill our reserves.

The second trade earned 50% across the long Labor Day weekend. Suddenly the reserves were almost completely replenished. The gap had closed.

And just last week, the third trade scored 41% in 24 hours. Those new 2-Day Traders are now up a net 18% across their first month of membership. Meanwhile the S&P 500 is down 2%.

That’s how we do it. We don’t hug the bench terrified of striking out. We get out there and we trade the best trends I can find, over and over. Do that long enough and even a few catastrophic losses . . . a few “crashes” . . . are just part of the cost of doing business.

And it doesn’t take all that long. Running these numbers, someone who followed the 2-Day Trader system since the year started and matched my official score trade for trade would have turned a $10,000 starting stake into $60,000. We did it despite a few losses that would cripple a typical buy-and-hold retail investor.

Sound fun? It isn’t for everyone but our people aren’t exactly fretting about the coming crash. For one thing, we can buy puts in that scenario, again and again for as long as stocks and sectors decline.