24/7 Wall St.

December historically has been a good month for the stock market, but in 2018 that Santa Clause rally remains elusive. Blame the trade war, tariffs, an arrest of a key Chinese executive, inverted yield curve fears, geopolitics, peak earnings and so on. And many investors are worried about 2019 not being as good as the political gridlock of past years. The bull market just feels old after 10 years, and many market pundits and reports are continually referring to the current climate as a late-cycle market and economy.

While the stock market has proven over and over that it can bounce back rapidly, often merely because it is oversold, the reality is that investors in 2018 have found it less rewarding chasing every market sell-off than in prior years. The Dow Jones industrials and the S&P 500 even went back into negative territory for the entire year. It has become imperative that investors who are staying in the stock market not look away from their money and investments for very long. And the financial media keeps spooking the public by warning that the next market crash may be forming if current risks turn into reality.

There is another reality outside of fear. You don’t have to lose your assets during a stock market sell-off or even during a crash. Not only that, you can even profit from a stock market crash if you are already positioned.

24/7 Wall St. has gathered a list of 10 exchange-traded funds (ETFs) and exchange-traded notes (ETNs) for investors who want to keep their money invested during periods of uncertainty. These ETFs are simply go-to investment and trading vehicles if it looks like the stock market could tank at any moment. These cover multiple strategies outside of regular equity index investing, and we have included instances in which the ETFs have not performed properly at times. We also have identified some risks and caveats that investors need to consider about each fund.

The next time you see the stock market sell off big, similar to now, be sure to look back at the performance of these specific ETF products. You’ll probably be surprised just much better they do as a whole compared to any index tracking the Dow Jones industrial average, the S&P 500 and the Nasdaq 100. Investors also should consider that there are probably a few options from other ETF issuers that compete against these, almost down to the exact same strategy. Leveraged ETFs and those that are too difficult to easily explain have been left out of this review.

Here are 10 ETFs for investors to seek out of they are worried about a next stock market sell-off or crash right around the corner. And remember, some of these ETFs are built to fly higher during rocky stock markets.

1. Short-Term Treasury ETF

There’s supposed to be a tug-of-war of some sort between stocks and bonds during periods of volatility and uncertainty. When investors get spooked out of stocks, they often decide to park in short-term and intermediate-term bonds and the funds that track them. The Schwab Short-Term U.S. Treasury ETF (NYSE: SCHO) is probably about as safe as you get because it only invests in short-duration government debt. You’re never going to get rich investing in short-term and money-market funds, but you won’t have to worry about looking away from the ticker tape a couple of days and seeing your investment down 10%, 15% or worse. There are multiple short-term and money market instruments out there to choose from.

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