Hedging a portfolio against a drop in stocks

With all 3 indexes continuing to slowly grind their way higher, a lot of investors find themselves worried about a potential dip in the market. Markets can definitely surprise and when they turn lower, often it can be quite volatile.

The problem though is that buying SPY or SPX Options means an investor has placed “a bet” that the market will fall and if wrong, the options will quickly begin to lose value. Buying options means an investor is holding a wasting asset. That means unless the market moves in the “right” direction, the options could expire worthless and capital is lost.

This strategy article for members explains a simple hedge strategy that I have used since 1995 to protect a portion of my portfolio and to profit from periods of pullbacks and corrections.

This strategy article is 1600 words in length and will need 5 pages if printed.

The rest of this strategy article is for FullyInformed Members.

How To Protect and Profit Against A Potential Dip In Stocks – Apr 29 2019



Disclaimer: There are risks involved in all investment strategies and investors can and do lose capital. Trade at your own risk. Stocks, options and investing are risky and can result in considerable losses. None of the strategies, stocks or information discussed and presented are financial or trading advice or recommendations. Everything presented and discussed are the author’s own trade ideas and opinions which the author may or may not enter into. The author assumes no liability for topics, ideas, errors, omissions, content and external links and trades done or not done. The author may or may not enter the trades mentioned. Some positions in mentioned stocks may already be held or are being adjusted.

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